Feds probe finances at Fairfield Housing Authority
Updated 8:55 am, Thursday, December 6, 2012
A special agent from the federal Department of Housing and Urban Development is investigating "suspect transactions" at the Fairfield Housing Authority, apparently including the role of the agency's top official who left last year.
FHA Executive Director Carol Martin, who came on board at the end of April, told the Fairfield Citizen on Wednesday that when she took over the job, "There were some suspect transactions and we turned it over to federal investigators." Martin, who succeeded Elizabeth Gutierrez, said she could not comment further on the matter because of the investigation, but added the FHA is cooperating fully.
The probe of finances at the FHA, which has had three executive directors since long-time Director Charles Feld retired in 2007, was revealed during a Board of Finance discussion Tuesday night of the $65,000 still owed by the agency to the town for payroll processing. That practice was discontinued several years ago.
"The authorities are pursuing the person who allegedly absconded with some funds," Robert Mayer, the first selectman's chief of staff and the town's acting fiscal officer, told the finance panel.
No names were specifically mentioned as possible subjects of the investigation, but James Walsh, a finance board member and former selectman, made reference to an "employee of the housing authority who left." Since the FHA is partially funded by federal money, he said, "the FBI was following her." Walsh also said this former employee now lives in Truth or Consequences, N.M.
The probe at this point, however, is being handled by HUD and not the FBI.
Investigations into allegations of fraud involving housing authorities are handled by the Department of Housing and Urban Development's Office of Inspector General in the district office with jurisdiction for the state -- in this instance, that is the New England District office in Boston. A call to that office was not returned.
Gutierrez, Martin's predecessor, was granted a six-to-eight-week leave of absence by the housing authority last December. In January, FHA board members learned Gutierrez had submitted a letter of resignation effective Dec. 31, 2011, and apparently took a similar post in Truth or Consequences, N.M. Prior to coming to Fairfield, Gutierrez was the director of four New York statewide housing programs. Gutierrez took the post in August 2010, succeeding Marilyn McNee, who was hired to replace Feld and held the job three years.
According to a May 15 story in a Truth or Consequences newspaper, "The Herald," the local housing authority's executive director, Elizabeth Gutierrez, was scheduled to give a presentation at a City Commission meeting. It could not be confirmed Wednesday that Gutierrez is the same official who held the Fairfield post; calls to the New Mexico city's offices were not returned to the Fairfield Citizen.
First Selectman Michael Tetreau reminded the finance board Tuesday that while Fairfield Housing Authority board members are appointed by the town, the agency is quasi-independent and does not report to the town.
On Wednesday, Tetreau said, "Starting last spring, shortly after (Gutierrez) left the FHA, we sat down with the chairman of the housing authority, one of the remaining executive staff and representatives of HUD, and talked about where the organization was and some of the financial challenges they were having and where they were going.
"The investigation into the executive director was happening on a parallel path and we weren't directly involved in that investigation."
Tetreau said he doesn't how much money was involved in the suspect transactions.
As for the housing authority's ability to repay the $65,000 it owes the town in the near future, Mayer said that does not seem likely. The authority, which manages the Trefoil Court and Pine Tree Lane housing complexes for seniors and the local housing voucher program, has a $327,000 federal deficit. "I don't know if they can pay it before clearing that up," he said.
"I think it would be nice to get an agreement that would be between the housing authority and the town," Walsh said, that acknowledges the payroll-processing debt "to the penny."
Finance board member James Brown said the town does have a letter dated Oct. 29 from Martin asking that the agency be released from the $65,000 payroll-processing obligation. Brown asked if the town had any intention of writing off the debt.
Mayer replied that the town has no intention of writing off the debt, and that the authority's director and chairman have been so informed.
"The housing authority has been very cooperative," Tetreau said. "They had some internal issues that they had to clear up." He said the agency "brought in a new manager, who is phenomenal."