Feds: 80 lied to get housing funds

By Rhonda Cook

The Atlanta Journal-Constitution

State and federal authorities swept across Georgia Wednesday scooping up dozens of people who claimed federal housing subsidies they were not entitled to receive.

By midday, 48 people were in custody and state and federal agents were planning to serve arrest warrants on the remaining 32 people by the end of the day. A total of 80 people were targeted by "Operation Clean House."

The Georgia Department of Community Affairs, which distributes  federal housing funds in 149 counties, and the U.S. Department of Housing and Urban Development, which administers the  Section 8 Housing Choice Voucher program, expect the sweep will prompt some who have been getting money illegally to withdraw from the program or lead some to report their neighbors were not entitled to the subsidies. They expect to get tips called in to the agency's hotline, 1-800-347-3735, or e-mailed to hotline@hudoig.gov.

"What we did today was an impact sweep," said Herschell Harvell, special agent in charge with the HUD Office of the Inspector General. "It's to send a message to those violating the program."

Those arrested Wednesday face state charges of theft by taking or making a false statement to obtain federal funds. Federal charges also are possible, officials said.

"A person who  receives benefits they are not entitled to steals taxpayer money," said Georgia Bureau of Investigation Director Vernon Keenan.

The arrests warrants were for people in 31 of the 149 Georgia counties that work through the state Department of Community Affairs to get Section 8 funds. The other 10 counties -- including Clayton, Cobb, DeKalb and Fulton  --  have housing authorities that deal directly with the federal government.  In most cases, only one or two people were arrested in each county though there were nine people arrested in Augusta [Richmond County has a housing authority for those living outside the city limits] and 18 were arrested in Dougherty County in southwest Georgia.

The Section 8 program was created to subsidize the rents of very poor, the elderly and the disabled. The qualifications and the amount of the subsidy are determined by income and the number of people in the household. Only people making less than half the median income for the area where they live can qualify but the rules are that 75 percent of the people in the program must make no more than 30 percent of the median income in their area. Program participants pay part of their rents -- an amount equal to 30 percent of the household's income -- and the federal government directly pays the landlords the remainder.

Dennis Williams with the state Department of Community Affairs said those caught in Wednesday's sweep qualified when they first came into the program but they either lied about their income or the number of people in their households when they went through the annual process of re-qualifying. A few of the cases date back to 2008 but most of them occurred in the previous year, he said.

The problem is not new, said Edward Jennings, HUD's southeast regional administrator.

The agency is trying to be "more aggressive" now if finding those scamming the system.

"The public trust has been violated by those individuals," Jennings said. "You cannot take advantage of your neighbor."

Section 8 properties are privately owned and it is up to the program participant to locate single-family houses, townhouses and apartments that qualify.

But there is a shortage of Section 8 housing as evidenced early last month when about 30,000 people crowded into the Tri-Cities Plaza Shopping Center in East Point just to  get applications for one of the 455 open spots on a waiting list.  Some of those people camped out for two hot days .

The crowd got rowdy when people broke in line as housing officials began handing out applications. Twenty people had to be taken to the hospital because of heat or other health problems.

This summer was the first time since 2002 that the East Point Housing Authority accepted applications. The crowd was triple what officials had expected.

About 15,000 Georgians get Section 8 housing assistance and thousands more are on waiting lists.

A week after the incident in East Point, HUD began reviewing its policies for distributing vouchers and advising local public housing offices to better prepare for bigger-than-expected crowds.

Soon after HUD's Atlanta office reported it had received "a couple" of reports of scam artists trying to sell fake housing vouchers.