A federal audit has identified payments made to deceased individuals and ineligible recipients under Colorado’s housing assistance programs. The Department of Housing and Urban Development (HUD) is now investigating whether public housing providers improperly distributed federal funds to nearly 3,000 individuals.
The internal review found that benefits were granted to 221 deceased people, with another 87 individuals receiving funds who did not meet eligibility requirements. Additionally, HUD reported that 2,519 beneficiaries require further verification and correction of their records.
“From deceased tenants to individuals receiving housing benefits who were never supposed to be on the rolls,” a HUD spokesperson said. “The department has questions for HUD-supported housing providers in Colorado, and we expect prompt answers and enforcement action.”
According to a source familiar with the matter, the issues were identified across most of Colorado’s 59 public housing agencies, with the Denver Housing Authority being particularly affected. HUD has directed public housing agencies to conduct additional verification processes, remove ineligible individuals from program rolls, and correct beneficiary records.
Housing providers who fail to comply may be required to reimburse federal funds paid to ineligible recipients and could face sanctions. Colorado’s public housing agencies oversee approximately 38,000 leased units through public housing and housing choice voucher programs, with HUD providing about $440 million in federal assistance annually.
Under program rules, tenants typically contribute around 30% of their income toward housing costs. The investigation follows HUD’s recent deployment of investigators to Minneapolis and St. Paul for reviews of housing programs in those cities, which is part of a broader scrutiny targeting potential fraud in social services.
