HUD ACTS TO BAR BAD LANDLORDS
WASHINGTON -- Intensifying its crackdown on bad landlords,
the Department of Housing and Urban Development today permanently
barred 13 landlords in five cities from doing new business with
HUD, Secretary Andrew Cuomo said.
IN FIVE CITIES
FEDERAL GOVERNMENT CONTRACTS
* * *
"GET TOUGH" CRACKDOWN SPREADS ACROSS NATION
Cuomo said HUD also took action to bar the landlords from
receiving new contracts from other federal agencies for three to
"We will not allow bad landlords to use HUD programs like
personal ATM machines, costing taxpayers millions of dollars,"
Cuomo said. "Uncle Sam is taking the ATMs out of service."
"The actions we are taking today can cost bad landlords
dearly," Cuomo said. "Business people can suffer serious
financial damage by being barred from doing new business with the
The landlords owned property in Auburn, AL; Balcones
Heights, TX; San Antonio, TX; Richmond, VA; and Tucson, AZ.
Cuomo said the landlords received HUD mortgage insurance in
exchange for providing safe and decent housing for the poor. He
said the landlords then improperly pocketed $6.7 million in rents
that should have been used to make mortgage payments, causing
their properties to go into default and be taken over by HUD.
HUD acquired the properties in the five cities, paid $23.1
million in insurance claims to lenders holding the mortgages, and
then sold the properties for $11.4 million -- $11.7 million less
than the cost of the insurance claims. HUD worked with the
Justice Department to obtain $4.7 million in judgments against
some of the former landlords.
Today's action was part of a nationwide crackdown called
"Get Tough Against Bad Landlords" that was announced last week by
Cuomo and Attorney General Janet Reno. Enforcement actions were
then announced against landlords in Chicago; LaFource Parish, LA;
Dallas; Indianapolis and New York City.
The 13 debarment actions announced today were the first of
dozens HUD expects in the coming months. In all of 1996, HUD
sought debarments against 22 individuals.
Cuomo identified the 13 landlords as:
- Phillip E. Dutton, Grover C. Fleming, Robert D. Word and
Michael J. Vickers, who owned Hudson Arms Apartments in Auburn,
AL. A HUD audit found the landlords had improperly pocketed
$130,000. After the U.S. Attorney filed a civil complaint against
the landlords, a judge ordered them to pay a penalty of $260,000
in 1995. HUD foreclosed on the apartment project, paid the lender
holding the mortgage $4.2 million in insurance claims and sold
the project for $2.1 million.
- Ronald L. Temple and Carol L. Temple, who owned Henrico
Country Club Apartments in Richmond, VA. A HUD investigation
determined that the landlords diverted more than $1 million in
rents and other income while not paying their HUD-insured
mortgage. The U.S. Attorney filed a civil action and obtained a
$4.4 million consent judgment against the owners in 1995. The
title to the apartment project was transferred to HUD, HUD paid
the mortgage holder $2.7 million in insurance claims and then
sold the apartments for $2.1 million.
- James W. Anthony, who owned: Alta Villa Apartments in
Balcones Heights, TX; and Cambridge Apartments, Greenhouse
Apartments, and Park Town Apartments in San Antonio, TX. An audit
found the landlord had collected $550,000 in excess funds. HUD
foreclosed on the properties, paid the mortgage holder $10.3
million in insurance claims and sold the properties in 1994 and
1995 for $2.9 million.
- Donald DalBianco, Robin Williamson, Michael Florence,
Anthony Swartz, Norman Winston and Teresa Warren, who owned Park
Villa Convalescent Center in Tucson, AZ. A HUD audit found that
the owners made or allowed $4.85 million in payments that
violated HUD program requirements and made another $212,000 in
payments not supported by accounting records. HUD took over the
property, paid the mortgage holder $5.9 million in insurance
claims and sold the property in 1993 for $4.3 million.
In addition to permanently barring all the landlords from
dealings with HUD, the Department took action to debar Anthony
for three years and the other landlords for five years from
contracts with other federal agencies.
Content Archived: January 20, 2009