HUD Targets Colorado Housing Providers Over Alleged Fraud Involving Thousands of Deceased and Ineligible Recipients

A federal audit has revealed that the Trump administration is investigating housing assistance programs in Colorado following the identification of payments made to deceased individuals and ineligible recipients.

According to the Department of Housing and Urban Development, an internal audit found benefits were granted to 221 deceased people. Funds may have also been improperly disbursed to another 87 individuals who did not meet eligibility requirements.

HUD further reported that 2,519 additional beneficiaries require additional review. “From deceased tenants to individuals receiving HUD housing benefits who were never supposed to, the department has questions for HUD-supported housing providers in Colorado, and we expect prompt answers and enforcement action,” a HUD spokesperson told reporters.

A source familiar with the matter indicated the issues were identified across most of Colorado’s 59 public housing agencies but were especially concentrated within the Denver Housing Authority.

HUD plans to require public housing agencies to conduct additional verification, remove deceased and ineligible individuals from program rolls, and correct beneficiary records. Providers may also be required to reimburse federal funds paid to ineligible recipients and could face sanctions for noncompliance.

Colorado’s public housing agencies oversee approximately 38,000 leased units through public housing and housing choice voucher programs. HUD provides about $440 million in federal housing assistance to the state. Under program rules, tenants typically contribute about 30% of their income toward housing costs.

Earlier this week, HUD sent investigators to Minneapolis and St. Paul to review housing programs in those cities, following reports of potential fraud in Minnesota’s social services programs. The federal investigation is targeting as much as $1 billion in taxpayer funds that may have been siphoned from Minnesota’s social services through a series of fraud schemes, including the Feeding Our Future scandal.