- The Washington Times - Thursday, January 8, 2015

The Department of Housing and Urban Development is still trying to calculate the actual cost of fraud by former employee Brian Thompson, who is headed to prison this week after being sentenced to skimming money from sales of HUD properties.

Prosecutors said Thompson, who was hired despite a lengthy criminal record that included theft and larceny, stole $840,000 from HUD’s Office of Native American Programs. But in documents filed in his case, department officials said there’s no way of ascertaining “the level of damage” he caused.

“There are hundreds of unexplained bills, properties with unexplained resolutions and a complete lack of transparency that will take years to fully unwind,” one unnamed official in the office said, according to a memo filed this week by the U.S. attorney’s office in Washington.

Thompson was one of ten employees charged with selling off foreclosed, HUD-backed properties. He joined the agency despite a criminal record that included a 1980 armed robbery conviction and a series of “theft/larceny arrests and convictions” from 1984 to 2007, as well as a 2008 conviction for receiving stolen property, court records show.

HUD officials are looking into what went wrong in Thompson’s background check, but they’re also spending significant time sorting through files in a fraud that accounted for 12 percent of the office’s $7 million budget.

Thompson’s attorney has said in court papers that the office was in “massive disarray” when he joined, with employees keeping paper files scattered on the floors of cubicles and records revealing that some banks were getting paid more than once. The lawyer says Thompson helped modernize the dysfunctional loan office, overseeing a computer system to monitor claims, payments and properties all on one platform.

But co-workers disagree, calling the database used by the loan office “rudimentary, inaccurate and unhelpful” in a disclosure that raises broader questions about accountability inside the office, which handles tens of millions of dollars property transactions.

One employee who worked in the office at the same time as Thompson told prosecutors that the system has no second level review nor was it able to provide basic information, such as a list of property being sold.

The paper files were worse. Thompson’s records were “either devoid of all relevant documentation or populated with counterfeit documents,” according to the HUD coworker.

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