- The Washington Times - Sunday, May 7, 2006

A probe into the use of federal housing money in the District has led investigators to examine the personal bank records of the chief executive of a prominent nonprofit group, court records show.

Bessie E. Swann, executive director for the District-based Wheeler Creek Estates Community Development Corp., tried last year to stop investigators from obtaining her bank records, but a judge recently granted them access on the grounds that the U.S. Department of Housing and Urban Development (HUD) was conducing a “legitimate and reasonable” law-enforcement inquiry, court records show.

Wheeler Creek is a 314-unit housing development in Southeast, and Miss Swann has won praise for the nonprofit group’s work transforming old public housing into a mix of rental properties and resident-owned homes. She was appointed to Mayor Anthony A. Williams’ housing strategy task force in 2004.

The group, which also oversees job training and senior-citizen services, has received funding through HUD and the D.C. Housing Authority.

Wheeler Creek receives most of its $3 million in annual revenue through government grants, tax records show. The financial records also show Miss Swann’s compensation has nearly tripled in recent years.

In 2002, Miss Swann took home $110,000 in compensation. The next year, she received $198,000. And in 2004, Miss Wheeler received $312,725 in salary plus $10,723 in benefits, records show.

By comparison, the Marshall Heights Community Development Corp., also a recipient of HUD funding with about $3 million in annual revenue, pays its chief executive $85,000 a year, according to 2004 tax records.

Miss Swann said she has cooperated with the federal investigation, but sought to block access to her personal banking records because she felt her privacy was invaded.

“They’re going into my personal financial records, and for what?” she asked. “To see how I spend my money. I have nothing to hide, but I felt like that was just going too far.”

Miss Swann also said the pay increase was because Wheeler Creek has several new programs, so the organization’s board of directors gave her added responsibilities and more pay instead of hiring a manager for each new program.

From 2002 to 2004, while Miss Swann’s pay nearly tripled, the organization’s annual revenues increased from $678,867 a year to $3 million annually, tax records show.

Ronald Jones, president of Wheeler Creek’s board of directors, said the board approved Miss Swann’s compensation. Mr. Jones said he did not know why HUD officials were investigating the group.

“Sometimes when you’re successful, you become a target, and Wheeler Creek is wildly successful,” he said.

Federal officials declined to comment, and the city’s housing authority did not return phone calls last week.

In March, U.S. District Court Judge Emmet G. Sullivan granted HUD access to Miss Swann’s personal bank records, citing a five-page report issued in January by Magistrate Judge John Facciola.

In his report, Judge Facciola stated the Office of Inspector General (OIG) for HUD has been investigating the disbursement of Hope VI grants to community groups in the District.

The HOPE VI program is funded by HUD and administered to community groups locally by the city’s housing authority. The “Homeownership and Opportunity for People Everywhere” program, or Hope VI, aims to replace run-down housing projects with new housing developments.

Wheeler Creek has won several honors under Miss Swann, including awards from the Ford Foundation, Harvard University, HUD and the National Association of Home Builders.

Most records in Miss Swann’s case were filed under seal. But Judge Facciola’s report is public and states the subpoena for Miss Swann’s bank records was issued “in connection with a legitimate law enforcement inquiry, specifically, OIG and HUD’s investigation of HOPE VI program abuses.”

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