HUD Abandons A Tainted Loan Program (2/21/97)
Smooth Sailing So Far For Cuomo, Daley (1/23/97)
Department of Housing and Urban Development
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Clinton Administration Targets Housing Fraud
A joint Justice, HUD campaign to end subsidy abuses
WASHINGTON (AllPolitics, March 25) -- The federal government announced Monday a major crackdown on owners of government-insured or subsidized housing who are profiting illegally at the expense of low-income tenants and taxpayers.
For years the owners of some low-income housing projects have been pocketing millions of dollars in federal subsidies, instead of using that money to pay their mortgages or maintain their buildings.
Federal officials say they're fed up. Housing and Urban Development (HUD) Secretary Andrew Cuomo and Attorney General Janet Reno announced a joint $50 million, "Get Tough on Bad Landlords" campaign for the nation's 50 biggest cities.
From New York to Los Angeles, "Our message today to landlords is very simple, if you misuse federal resources, we will find out, we will track you down, and we will make you pay," Cuomo said.
"This is a double crime -- defrauding taxpayers of precious financial resources, and at the same time, subjecting residents to intolerable living conditions," Cuomo said. "It is illegal. It is wrong. It must end, and starting today, it will," he said.
HUD pays out approximately $9 billion a year in subsidies to privately owned properties that house more than a million people earning low-to-moderate incomes.
The initiative will bring criminal and civil charges against landlords who use the federal money fraudulently. The government has already begun taking action in several locations, including a federal takeover of a run-down apartment complex in New York City less than two weeks ago.
Reno issued a warning to the landlords: "Owning a HUD-insured or subsidized building is not a license to unfairly profit at taxpayers' expense."
HUD estimates that a quarter of the nation's federally insured or subsidized properties are in deplorable condition.
CNN's Kyoko Altman contributed to this report.