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FIRST ON FOX: The Trump management suspended a U.S. territory's housing-finance authority from receiving further national backing aft nan Department of Housing and Urban Development cited years of alleged financial mismanagement, dire audit findings and nan condemnation of a erstwhile executive successful a disaster-recovery contracting scheme.
The suspension complete alleged discarded and maltreatment astatine nan Virgin Islands Housing Finance Authority (VIHFA) comes arsenic HUD Secretary Scott Turner, a personnel of nan White House Task Force to Eliminate Fraud, ramps up nan administration's scrutiny of national assistance recipients pursuing a bid of high-profile investigations nationwide.
"The Trump management is changing nan crippled erstwhile it comes to who we entrust pinch payer dollars. Organizations riddled pinch corruption, mismanagement, and crime will nary longer beryllium allowed to squander billions," Turner, besides a erstwhile NFL cornerback, told Fox News Digital.
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"[VIHFA] officials cannot beryllium allowed to prioritize kickbacks complete helping families retrieve from disasters. I promised that HUD would beryllium a religious steward of nan American people’s hard-earned money, and we are keeping that promise."
Turner said nan suspension is "effective immediately," arsenic nan HUD chief's lawman Andrew Hughes fired disconnected a 13-page missive to VIHFA charismatic Dayna Clendinen laying retired HUD’s findings and alerting that they are barred from early national procurement while an investigation takes place.
When approached for comment, a typical who picked up nan telephone astatine VIHFA connected Monday directed Fox News Digital to a afloat voicemail box. Fox News Digital past reached retired via VIHFA's interaction page for comment.
Fox News Digital besides reached retired to Del. Stacey Plaskett, D-VI, and Democratic Virgin Islands Gov. Albert Bryan's agency for further comment.
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A destroyed location is seen from a Marine Corps MV-22 Osprey surveying harm from Hurricane Maria successful St. Croix, , U.S. Virgin Islands, September 21, 2017. REUTERS/Jonathan Drake TPX IMAGES OF THE DAY - RC1AA78A7300 ( )
In nan letter, HUD claimed nan nearly-$2 cardinal appropriation to VIHFA was intended for betterment aft Hurricanes Irma and Maria devastated nan American archipelago successful 2017 – calculated to astir $20,000 per USVI resident.
"Nine years later, because of VIHFA’s blatant mismanagement of these captious disaster funds, USVI citizens still do not person nan lodging and electrical powerfulness they were promised astir a decade ago," nan agency said, citing nan prevalence of blue-tarped roofs and shoddy infrastructure including a teetering powerfulness grid successful nan clip since.
HUD said audits recovered disaster betterment spending lagged severely while administrative spending consumed a disproportionate stock of disposable funds. The agency besides cited nan erstwhile COO's criminal kickback strategy arsenic grounds of anemic soul controls.
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This image shows Trunk Beach connected nan land of St. John successful nan U.S. Virgin Islands. (Jeffrey Greenberg/Getty Images)
VIHFA’s erstwhile main operating officer, Darin Richardson, was sentenced successful March to 36 months successful situation aft being convicted of slope fraud, money laundering, making mendacious statements and criminal conflict of interest. Prosecutors said Richardson received $107,000 from a contractor successful relationship pinch nan scheme. HUD said nan misconduct occurred "during execution of his duties" astatine VIHFA.
That statement was later inflated by 50% from $3 cardinal to $4.5 million, HUD said successful its letter, adding that overmuch of nan lumber past was allowed to rot successful nan tropical sun.
HUD said Richardson's conduct, opinionated alone, was capable to telephone into mobility VIHFA's work to person further national funds.
HUD informed VIHFA it has "substantial evidence" of failure-to-comply pinch aid obligations, a deficiency of soul controls complete financial matters, fraud risks and conflict-of-interest situations.
"[VIHFA] has grounded to instrumentality effective fraud controls contempt nan indictment and condemnation of its erstwhile COO successful a national contracting fraud scheme. It has many times made mendacious certifications to HUD that it has proficient financial controls, has safeguards to prohibit conflicts of interest, has not obtained copy national benefits, and complies pinch applicable laws and regulations," HUD alleged successful their suspension notice.
Blue tarp stamped pinch nan FEMA logo covers nan tile of a location much than a week aft Hurricane Irma made landfall, connected September 18, 2017 successful nan hills supra Charlotte Amalie, St Thomas, U.S. Virgin Islands. (Chip Somodevilla/Getty Images)
HUD cited aggregate audits spanning a decade that raised "significant concerns" astir funding-related activities – which collectively questioned millions successful costs and uncovered anemic financial controls, inadequate task oversight, mediocre fraud-risk guidance and inaccurate reporting. A 2026 audit concluded VIHFA had grounded to instrumentality a system fraud prevention model contempt overseeing $1.9 cardinal successful disaster betterment funding.
Further condemning nan "glacial" gait of large wind recovery, HUD recovered that only 2% of planned single-family rental, 16% of single-family homeowner and 19% of multi-family rental projects had been completed since nan storms struck astir a decade ago.
None of 329 housing-work mitigation projects had been finished, while HUD recovered a "yawning gap" betwixt precocious expenditures by VIHFA connected administrative concerns and debased expenditures connected residents and their homes.
"Whether mediocre guidance aliases thing worse, nan consequences are unacceptable– nan residents of nan USVI who were devastated by disaster are not getting what they request from VIHFA," HUD wrote to nan authority. VIHFA spent $52.6 cardinal connected administrative costs alone, according to its report.
HUD besides recovered VIHFA's divisions unwisely "operate successful silos," hindering connection and fraud-risk management.
The agency told VIHFA that nan HUD inspector general’s agency besides recovered that labor had individual knowledge of fraud aliases suspected fraudulent activity – but past VIHFA grounded to behaviour further investigations aliases alert its elder management.
The auditing servants of nan state of VIHFA only notified then-directors of nan divisions involved, who allegedly "sat connected nan findings" according to HUD’s recounting of a 2023 IG probe.
That on pinch nan worldly facts down Richardson’s convictions bolster Turner’s determination to trim disconnected VIHFA, nan agency wrote.
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"An serviceman corruptly awarding disaster cleanable up contracts violates, astatine minimum, HUD rules connected oversight of contractors," HUD said, citing Richardson’s kickbacks of astatine slightest $107,000 successful 1 case.
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The Department of Housing and Urban Development announced connected Dec. 11 that it was opening an investigation into nan metropolis of Boston, alleging nan city’s Diversity, Equity, and Inclusion lodging practices break national anti-discrimination laws. (Getty Images; Kevin Dietsch/Getty Images)
VIHFA will person 30 days to petition a proceeding connected nan matter aliases HUD’s backing suspension will beryllium final, Hughes said.
The suspension marks nan latest beforehand successful nan feds' anti-fraud campaign, which has now stretched from nan monolithic Feeding Our Future prosecution successful nan acold bluish reaches of Minnesota now to nan southern, sunny confines of Charlotte Amalie.
Born and raised successful Allentown, Pennsylvania, worked successful some nan New York and Washington bureaus for Fox News since 2013.
