By Kate Alexander
WASHINGTON – More than 680 Maryland police officers and teachers have purchased homes for half-price under a federal homeownership program that investigators now say is rife with fraud.
The U.S. Department of Housing and Urban Development temporarily suspended the Officer Next Door and Teacher Next Door programs last week, after an internal investigation estimated that as many as 25 percent of the nearly 4,000 buyers under the program since 1997 broke the rules.
The 120-day moratorium was instituted because “the oversight measures simply need strengthening,” said HUD Secretary Mel Martinez in a news statement Thursday. HUD officials expect the program to be re-opened on July 3 with stronger management controls.
A HUD spokesman said none of the nine felony convictions or indictments that prompted the suspension were in Maryland, where a Prince George’s County Police officer pleaded guilty in March to defrauding the program.
Prince George’s Officer Stacey Oneal Sims is the only teacher or police officer to be charged in Maryland for defrauding the programs. Officials with the U.S. Attorney’s Office in Baltimore refused to say whether the office was investigating any of the hundreds of other teacher and police officers in the state who have signed up for the programs.
The programs require that officers and teachers live in their discount homes for at least three years. Sims, who bought a home in Forestville property for about 50 percent of the listed price, subsequently rented it out within eight months, according to prosecutors. But he reported to HUD that he was still living at the Forestville home.
Sims pleaded guilty last week to making a false statement to HUD, and could get up to two years in prison and a $250,000 fine when he is sentenced in July.
Representatives from the state and local unions for police and teachers did not return phone calls seeking comment on the reported problems with the programs. But a national police union spokesman said the moratorium is welcome if it will ultimately save the programs.
“We want this program to continue (but) this is a problem that needs to be fixed for it to continue,” said Tim Richardson, spokesman for the Grand Lodge of the Fraternal Order of Police.
Richardson said the union would work with HUD during the moratorium to share ideas about how enforcement can be improved, but he would not elaborate any further.
Both “next door” programs were created to stabilize marginal neighborhoods by encouraging law enforcement officers and teachers to become homeowners and residents in those neighborhoods.
The participants can purchase HUD-owned, single family homes in revitalization zones, usually at steep discounts.
Of the more than 680 homes that have been sold in Maryland under the programs, 60 percent are located in Baltimore City and Prince George’s County, according to January figures from HUD.