County Housing Investigated

September 11, 1991|By JoAnna Daemmrich | JoAnna Daemmrich,Staff writer

Federal housing officials are investigating allegations of spending improprieties and potential fraud at the Anne Arundel Housing Authority over the past four years.

The probe centers on accusations that senior administrators signed purchase orders without proper authorization and took advantage of government discounts to buy home appliances.

The regional inspector general for the U.S. Department of Housing and Urban Development in Philadelphia confirmed Monday that he's checking into the charges ofongoing misconduct.

FOR THE RECORD - A story in the Sept. 11 edition on an investigation of the county Housing Authority ("County housing investigated") excluded some information. In 1988, Sandra A. Ervin received approval from then-executive director Vincent Leggett to purchase kitchen appliances at wholesale prices through the authority. She paid the sales tax after the purchase was publicized.

"We're looking at it and making inquiries," said Robert J. Brickley, who heads the Office of Inspector General forthe mid-Atlantic region.

He cautioned that HUD just began preliminary inquiries, "not a full-scale criminal investigation." But he acknowledged the possibility of housing fraud.

Present and former employees at the county Housing Authority forwarded more than 40 documents to the Black Political Forum this summer that showed purchasing and procurement irregularities, said Lewis Bracy, chairman of the bipartisan coalition.

The forum voted to send the information to HUD's regional investigative branch, the same office that looked into accusations of fraud and racketeering at the Annapolis Housing Authority in 1987 and 1988.

Evidence found by the HUD inspector eventually was turned over to a federal grand jury, which indicted then-executive director Arthur G. Strissel on racketeering, wire fraud and bribery charges. He was convicted in November 1988 of conspiring in multi-million-dollar bid-rigging schemes, sentenced to 10 years in prison and ordered to pay a $45,000 fine.

None of the papers passed on to the Black Political Forum indicated similar allegations of bid-rigging orbribery at the county Housing Authority, Bracy said. The agency manages seven public housing communities with 1,026 apartments and town houses.

The documents, dating back to 1988, show purchasing irregularities by high- ranking administrators under the agency's past two executive directors, Bracy said. Most of the allegations involve usingthe authority's government discounts and wholesale prices to buy appliances and furniture for personal use.

"The information was unsolicited," Bracy said. "It came from . . . people who were concerned that those in positions of trust were taking advantage of their positions. They wanted it (the information) to get to the proper authorities."

In May, the forum issued a report on minority concerns that charged the public housing authority was "in shambles" and called for immediate changes. Several employees wrote the forum after that to express their own concerns.

Larry A. Loyd, a veteran housing official from Charlotte, N.C., who took over the public housing authority lastweek, said he knew nothing about the accusations.

"You are the bearer of that news to us," he said yesterday when a reporter called. "I'm sure HUD will conduct a thorough investigation."

Loyd is the fifth director to head the troubled authority in six years. He replaced June C. Waller, who was dismissed in January after failing to reduce a backlog of empty units while the waiting list grew to more than 1,600 seniors and families.

In 1988, Sandra A. Ervin, the chief accountant who served as acting director until Loyd was appointed, bought $3,757 worth of kitchen appliances for her home near Anne Arundel Community College at wholesale prices through the authority. She immediately reimbursed the agency, but saved money with the discount and did not pay sales tax.

"That happened three years ago, and it neverhappened again," Ervin said yesterday. "This dredging up of old business is in bad taste. It was looked into, and there was no impropriety there."

But the documents received by the Black Political Forum indicate housing employees continued using the authority's discount for personal purchases in 1989, 1990 and even this year, Bracy said. He declined to discuss more specific allegations until HUD's regional inspector general finishes his preliminary probe.

Ervin was named deputy director this week.

The agency has been plagued by management problems for years but has never been investigated for criminal wrongdoing federal housing officials said.

Frequent management turnover, lax maintenance and administrative mistakes have cost the authority HUD subsidies and modernization grants. The authority has been filling vacant units and creating programs.

Any management problems that come to light in investigating the allegations will be turned over to the HUD office in Baltimore, Brickley said.

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