U.S. Department of Housing and Urban Development (HUD) suspends federal disaster recovery funding to the U.S. Virgin Islands Housing Finance Authority, citing concerns about financial mismanagement and controls over the use of hurricane aid. According to HUD, the suspension follows findings that the authority has inadequate fraud prevention and oversight, including issues such as false certifications and improper payments, and that financial management problems have limited the pace and integrity of spending.
The suspension comes nearly a decade after Hurricanes Irma and Maria struck the territory. One report says the U.S. Virgin Islands has spent only a portion of its allocated recovery funding, with HUD estimating that mismanagement has kept roughly $1.3 billion from hurricane survivors, even though the territory received about $1.9 billion in federal recovery funds. Another report describes HUD’s action as linked to widespread financial misconduct and deficiencies in fraud controls.
HUD’s move affects disaster recovery dollars earmarked for housing-related programs in the territory. The reports describe HUD’s rationale but do not detail the authority’s response or any remediation plan in the cited coverage.
