- Associated Press - Thursday, October 16, 2014

NEW ORLEANS (AP) - A nonprofit agency’s former director should repay the federal government nearly $350,000 overpaid to contractors hired to gut houses after Hurricane Katrina, federal prosecutors said Thursday.

Defense attorney Edward Castaing said Stacey Jackson should be held responsible for about $150,000 of the overpayments by New Orleans Affordable Housing.

U.S. District Judge Mary Ann Vial Lemmon must decide what Jackson, who faces up to five years in prison after pleading guilty in July to one count of conspiracy, must repay as part of her sentence.

Sentencing was originally scheduled Thursday but was postponed until Friday morning after arguments about the money section of the probation office’s pre-sentencing report.

Money Castaing said Jackson shouldn’t have to pay $32,000 billed for property that NOAH contractor Earl Myers, who pleaded guilty before Jackson, planned to buy for $15,000 “and keep in his name as a ruse for her.” That property is still in Myers’ name, Castaing said.

Although Jackson paid some property taxes on the property, Castaing said, “it’s still in Earl Myers’ name. She never got the benefit. … I think maybe when the court considers restitution, it should come at Mr. Myers’ account.”

Paperwork filed with Jackson’s guilty plea listed nearly $50,000 in kickbacks.

The indictment and factual basis filed with Jackson’s guilty plea give examples rather than a full list of overpayments, Assistant U.S. Attorney Fred Harper told Lemmon.

“The indictment would have had to be hundreds of pages long” to include a full accounting, he said.

Harper said agents from the FBI, IRS and Department of Housing and Urban Development went house to house to find those for which the federal government had been billed even though they’d been gutted by volunteers or charities.

“Those houses were not done. And it amounts to $350,000,” he said.


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