HUD official has a talent for rooting out fraud

The Baltimore Sun

This is the second in a three-part series on Maryland-based finalists for the Service to America Medals, or Sammies, one of the highest honors bestowed on civil servants. The winners will be announced next month.

When Nicole Faison began working in a Baltimore public housing community in the late 1990s, she quickly caught on to what she described as "the game."

The more public housing residents earn, the more they pay in rent. So, to keep their rent low, tenants don't always report second and third jobs or welfare and Social Security benefits to housing officials.

In 2002, Faison, 36, was hired by the U.S. Department of Housing and Urban Development to fix the problem. Since then, the Glen Burnie resident has eliminated more than $2 billion in fraud. The Government Accountability Office has removed HUD's rental-assistance program from its "high-risk" list.

"One of the most incredible achievements in government is bringing something off of the high-risk list," said Max Stier, president of the Partnership for Public Service, which selected Faison as a finalist for a 2007 Service to America Medal. "It is the gold standard for the most significant and scary problems that government faces. Unfortunately, the list often grows and rarely shrinks."

Faison and HUD executives held two minicelebrations at the agency's headquarters in southwest Washington near L'Enfant Plaza, said David Vargas, Faison's mentor and former supervisor. And Faison and her colleagues who worked on the project were invited to meet President Bush in the Oval Office.

"There were whispers that we were going to get taken off of the list, and when it became official, there was screaming and high fives and hugging," Faison said.

In less than a decade, Faison, who grew up in Randallstown, went from assistant property manager at Gilmor Homes in Northwest Baltimore to director of public housing programs nationwide at HUD. She oversees a $6 billion program.

Faison said she was so desperate to fix the problems and shorten her commute from her former home that she applied for nearly 70 jobs at HUD during a three- to four-month period in 2002.

She took a pay cut and accepted an internship at HUD in August 2002. The next month, an executive plucked her from that job after reviewing Faison's application for another post and reading her 130-page plan to catch tenants' unreported income. She had written the paper for a master's degree class at Strayer University.

"My colleagues say I'm a true rags-to-riches story in the federal government," she said.

Faison spent 10 years earning her bachelor's degree at Towson University while working four or five jobs at a time, including processing checks for banks and assisting a photographer, said her father, Les Faison, a retired Baltimore firefighter who lives in Owings Mills.

When the Housing Authority of Baltimore City hired Faison in the 1998, she said, she encountered an unyielding bureaucracy.

"The first time I told a tenant that her rent was going up from $82 to $100 a month, she said, 'What do you mean my rent is going up?'" Faison said. "I was intimidated. She looked as if she was going to hop over the desk and punch me out. The next week someone actually threatened bodily harm."

Faison once went to grab a sandwich for lunch at Lexington Market and realized that the man working behind the counter was one of her tenants. He had told her he was unemployed.

In another case, Faison thought a tenant was being unfairly denied welfare benefits for three of her five children. When she placed a call to lobby on the woman's behalf, Faison found that the tenant was receiving Social Security benefits for the three children.

"You'd see apartments with 52-inch flat-screen TVs, plush leather sofas and steak and lobster in the refrigerator - and you're telling me you make $300 a month?" Faison said. "I went to college, got a job that pays less than $30,000 a year, and I didn't have nearly what these folks had. ... For me, it was shocking."

Faison submitted to her supervisor at the housing authority a proposal to combat fraud, but she never received a response.

She began surreptitiously developing a network of contacts at federal and state agencies. She would ask each agency to run tenants' names through databases and search for additional income.

Faison revealed her plan after her supervisor asked why the letter carrier was delivering bags and bags of mail from the local Social Security Administration office. Her supervisor also noticed growing amounts of unpaid rent on accounting sheets.

For instance, the authority once sued a tenant for $28,000 in unpaid rent.

"The judge said to me, 'Nicole, approach the bench. Is this number a typo?'" she said. "He thought there was an extra zero in there because the tenant was only paying $150 a month in rent, and yet she owed $28,000."

Faison took her idea up the chain anyway.

"The deputy director told me, 'Nicole, this is a great idea, but we don't want to be accused of chasing after poor people,'" she said.

Eventually, she prevailed. The authority gave her an office and assigned her to develop an income-verification program.

Faison accepted a job at HUD before she had time to get the Baltimore operation off the ground. "I called up a colleague at the Baltimore housing authority, and said, 'You are not going to believe this, but HUD just hired me to implement my so-called 'idiotic' idea," she said.

All of those checks that Faison used to do by phone, fax and mail are now available to public housing officials nationwide through a secure Web site.

A housing authority employee needs only to type a tenant's Social Security number into the system, and it checks whether residents are receiving unemployment or Social Security benefits, or earning more than they claim.

Vargas, who oversees housing-voucher programs, said most housing authorities are using the income-verification system, but that the agency is about to require it.

"It's going to read 'thou shalt' do this," he said. "In that late '90s, there were proposals to do away with HUD because of our inability to deliver. ... But now the pendulum has swung the opposite way. We're now taking over housing programs from FEMA," the Federal Emergency Management Agency.

Faison said a desire to restore integrity to public housing communities isn't her only motivation. Millions of people are on multiyear waiting lists for subsidized housing. Reducing fraud frees aid for needier families, she said.

"When I train employees, I always tell them that you never want to say that the tenant is lying," she said. "You say that the tenant is suffering from selective amnesia."

The writer can be reached at melissa.harris@baltsun.com or 410-715-2885. Recent columns can be read at baltimoresun.com/federal.

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