Develop and implement controls and procedures to ensure that HUD’s underwriters properly evaluate the creditworthiness of management agents when underwriting future loans.

Designate an unclaimed asset recovery official as required by the Treasury Financial Manual.

Work with Treasury to identify and obtain reimbursement for FHA’s and Ginnie Mae’s portion of the $1.9 million in HUD funds that Treasury collected.

Establish and implement policies and procedures to ensure that all of its unclaimed funds are claimed and the money is appropriately routed to put $2.2 million to better use. At a minimum, these policies and procedures should address what constitutes FHA and Ginnie Mae funds, ensure that these funds are returned to FHA or Ginnie Mae as appropriate, and include policies to claim co-owned funds with any appropriate thresholds or limitations.

We recommend that the Southwest Region Director of Multifamily Housing require the Eastwood Terrace Apartments owner to support that the subsidies for 77 tenants and units with income discrepancies, missing EIV reports, missing income verifications, missing annual certifications and missing signatures are supported and accurate or repay HUD $1,865,344 for those subsidies. Repayment must be from non-project funds.

We recommend that the Southwest Region Director of Multifamily Housing require the Eastwood Terrace Apartments owner to ensure tenants are housed in the correct unit size.

We recommend that the Southwest Region Director of Multifamily Housing require the Eastwood Terrace Apartments owner to ensure annual inspections are performed in a timely manner and in accordance with HUD requirements.

We recommend that the Southwest Region Director of Multifamily Housing require the Eastwood Terrace Apartments owner to ensure that its new property management agent is providing oversight to its onsite staff and that its recently implemented quality control program is working as designed and in accordance with HUD requirements.

We recommend that the Southwest Region Director of Multifamily Housing require the Eastwood Terrace Apartments owner to maintain tenant files in a manner that ensures they contain the correct records and all required documentation.

Provide supporting documentation for subsequent review to show that it properly calculated relocation rental assistance payments for the 10 tenants and if there is an overpayment, reimburse the applicable RAD relocation account from non-Federal funds.

Repay the project the $1,168,000 in ineligible distributions made to affiliated healthcare facilities during fiscal years 2015 and 2016.

Implement controls to ensure that project distributions are made from surplus cash and comply with the regulatory agreement and HUD requirements.

We recommend that the Chief Financial Officer determine whether the summary expenditures totaling $160,360,714, which exceeded the grant round obligations for the two grantees, were ADA violations. If the transactions were violations, action should be taken as required by the ADA.

We recommend that the Chief Financial Officer determine whether the revised and completed detail transactions totaling to $435,263,268, which occurred before and after grant rounds obligation and expenditure dates, were ADA violations. If the transactions were violations, actions should be taken as required by the ADA.

We recommend that the Chief Financial Officer determine whether the revised and completed transactions totaling $496,913,235 and made more than a year after the original voucher entry were GAAP violations. If the transactions were violations, appropriate actions should be taken, including but not limited to adjusting the transactions in LOCCS and HUD’s financial statements.

We recommend that the Chief Financial Officer enter a 24-month expiration term into LOCCS for Disaster Recovery funding provided by the 2017 Act and monitor to ensure that expenses are not entered before or after the grant period.

We recommend that the Chief Financial Officer require CPD to enter into a separate grant agreement for each grantee’s round of disaster funding for funding provided by the 2017 and 2018 Acts.

We recommend that the Chief Financial Officer require CPD to monitor the detailed voucher transactions in the DRGR system to ensure that grantees appropriately record transactions.

We recommend that the Chief Financial Officer require CPD to prohibit grantees from revising completed vouchers in the DRGR system and require adjustments to be entered as new vouchers into the DRGR system, which will ensure that LOCCS records and tracks revisions.

Develop and implement procedures to ensure that it maintains documentation to show that it selected participants from its waiting list in accordance with applicable requirements.