Former Executive Director of St. Clair Housing Commission Sentenced on Fraud Charges
Lorena Loren, the former executive director of the St. Clair Housing Commission, was sentence today to 37 months in federal prison after having pleaded guilty to conspiring to commit federal program fraud, announced United States Attorney Matthew Schneider.
Schneider was joined in the announcement by Brad Geary, Special Agent in Charge of the U.S. Department of Housing and Urban Development and Jeffery E. Peterson, Acting Special Agent in Charge, Federal Bureau of Investigation.
Loren, 55, of Nicholls, Georgia, admitted to conspiring with several family members to steal federal funds provided to the Commission by the U.S. Department of Housing and Urban Development (‘HUD”) to administer HUD’s low-income housing programs within St. Clair County. Loren admitted to engaging in various fraudulent schemes to unlawfully obtain over $336,000 in federal funds.
According to court records, Loren stole approximately $162,000 earmarked for HUD’s Housing Choice Voucher program, commonly known as Section 8 housing, which allows low-income families to lease privately owned rental properties with the assistance of HUD rental subsidies administered by the Commission. As part of this fraudulent scheme, between August of 2008 and August of 2016, Loren fraudulently entered into Section 8 contracts from which, at various times, she and nearly all of her immediate family members directly benefitted, in violation of HUD’s regulations and guidelines. In addition to falsifying Section 8 housing contracts and lease agreements by using nominees for lease agreements for Loren’s son, Loren and several relatives falsely claimed they owned rental properties which were, in fact, owned by others; where former Section 8 tenants resided; and, owned by Loren herself. Loren, as executive director, then fraudulently issued Section 8 rental subsidy payments to relatives, in some instances, even in the names of former Section 8 tenants who were no longer in the program. Loren also directed family members to establish joint bank accounts to facilitate access to the ill-gotten funds by various members of her family.
In addition, between 2010 and 2016, Loren used the Commission’s two credit cards to make unauthorized purchases of personal items for herself and relatives from Amazon.com, Walmart and Sam’s Club stores. Loren purchased, among other things, adult and infant clothing, furniture, food, beauty supplies, medications, other household items, and alcoholic beverages on the Commission’s cards. Loren had some of those purchases, totaling approximately $60,000, shipped to some of the same relatives involved in the Section 8 housing scheme at their residences in Georgia and Florida. Loren used the Commission’s operating budget, provided by HUD to maintain the Commission’s public housing facility, Palmer Park Manor, to pay for all the unauthorized purchases, which totaled nearly $166,000. Lastly, Loren also pocketed approximately $8,500 of the Commission’s petty cash funds.
As part of her guilty plea, Loren agreed to pay $336,240.62 in restitution to HUD. Pursuant to the stipulated order of forfeiture, the court issued a money judgment for $336,240.62, which will be paid with her full pension benefits and the proceeds from the sale of the Port Austin rental property that she used to commit the fraud in this case.
United States Attorney Schneider stated, ““This sentence shows that we will vigorously pursue public officials who steal the people’s money and use it for their own selfish gain.”
Brad Geary, Special Agent in Charge HUD said “At such a critical time for the Department of Housing and Urban Development, with programs that are vital to the well-being of so many in our communities, it is critical that those entrusted to public service are completely dedicated to those in need. The HUD Office of Inspector General is committed to partnering with Federal prosecutors and fellow law enforcement to aggressively pursue those engaged in activities that harm HUD’s Public Housing programs.”
“It is important we all remember this type of fraud scheme is not a victimless crime. It impacts many hard working, tax paying citizens and creates an unnecessary increase of government spending,” said Jeffery E. Peterson, Acting Special Agent in Charge, Detroit Division of the FBI.
The case was investigated by agents of U.S. Department of Housing and Urban Development-Office of Inspector General and the Federal Bureau of Investigation. The case was prosecuted by Assistant United States Attorney Dawn N. Ison.