CUOMO CONTINUES CRACKDOWN ON WASTE, FRAUD AND ABUSE IN ACTION AGAINST THREE PEOPLE AND ONE COMPANY IN PENNSYLVANIA

WASHINGTON -- Housing and Urban Development Secretary Andrew Cuomo today announced that HUD has stopped three people and one company in Pennsylvania from doing business with the federal government, as part of HUD's continuing crackdown on waste, fraud and abuse.

"HUD's days as a mugging victim are over," Cuomo said. "Anyone who tries to rip off this Department will be caught and punished to the full extent the law allows."

Cuomo said HUD took the actions against:

• Joyce Burton, a real estate agent in Philadelphia, who has been suspended from dealing with the federal government and proposed for a three-year debarment. Burton was convicted in U.S. District Court of making a false statement to obtain a HUD-insured mortgage and misappropriation of money from an organization receiving federal funds.
• Richard Brourman of Pittsburgh, the owner of Iron City Builders, and Bernice Brourman, Secretary and Treasurer of Iron City Builders, who were suspended and proposed for a three-year debarment. A HUD investigation revealed that Iron City Builders was allegedly involved in improper activities under HUD's Title I Home Improvement Loan Program. Iron City Builders is being sanctioned by HUD because it is an affiliate of the Brourmans.

The suspensions, will remain in place until the debarments are finalized or overturned on appeal.

The suspensions and debarment actions announced by Cuomo strike a financial blow against the individuals and will deprive them of all federal contracts for three years if finalized. Such contracts are a major source of income for many businesses.

"This is the latest in a series of actions we're taking at HUD to stop people from abusing our programs," Cuomo said. "Waste, fraud and abuse are an ugly part of HUD's past that have no place in our present and future."

Cuomo launched the "Get Tough" initiative to crack down on waste, fraud and abuse in HUD programs in March.

Actions taken so far include: a 500 percent increase from 1996 in the number of regulatory enforcement actions taken against bad landlords; collecting over $11 million in fines and awards from bad landlords; a doubling in the number of enforcement actions taken against officials responsible for administering programs in public housing; protecting senior citizens from reverse mortgage scams; and aggressively pursuing cases of illegal housing discrimination.

Here are details on the cases announced by Cuomo today:

• Burton was convicted of conspiring with two other people to apply for a $47,000 mortgage through Fleet Mortgage Corporation under HUD's Single Family Mortgage Insurance Program. She was sentenced to three years probation and was required to pay HUD $1,500 restitution. Burton and her co-conspirators submitted to HUD false and fraudulent information, including forged documents concerning the financial condition and personal history of a borrower. Burton was accused of forging another person's signature on a letter that falsely stated the borrower's savings account transactions. The submission of false information to HUD can result in a financial loss to the government. If a borrower obtains a HUD-insured loan that is larger than he or she can afford and the loan goes into default, HUD may have to pay for the financial loss to the lender.
• Iron City Builders allegedly contracted to perform home improvement work on three properties through HUD's Title I Home Improvement Program. The Brourmans allegedly submitted completion certificates for property improvement to receive payment for work that had not been finished. In addition, complaints were received from homeowners regarding the quality of some of the repair work done by Iron City Builders, and Iron City Builders failed to take corrective action to address the complaints.