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Federal raid seizes nonprofit records
Warrant seeks evidence of fraud related to HUD funding
(Published December 1, 2003)
Federal agents wielding a battering ram smashed their way into the Southeast Washington home of a local nonprofit group’s board president in late November, searching for evidence of alleged fraud and embezzlement of federal funds related to redevelopment of two public housing projects.
The agents, acting on a warrant issued by a U.S. District Court judge, confiscated a computer and financial records from the home office of Brenda Graham, president of Just U Wait N See, a resident-run group formed in partnership with the D.C. Housing Authority.
The group was created to help provide federally mandated transitional services to tenants of two recently redeveloped public housing sites on Alabama Avenue SE, now combined into one new mixed-income development called Henson Ridge.
Graham, in an interview with The Common Denominator, denied any wrongdoing.
"In the name of Jesus, I’ve never taken any money that didn’t belong to me," she said.
The Nov. 21 raid, which left a softball-sized hole in the front door of Graham’s Henson Ridge tonwhouse, came six months after federal agents made a less violent appearance at Just U Wait N See’s then-offices, also on the Henson Ridge property.
In that late-May visit, federal agents arrived as D.C. Housing Authority officials were carrying out computers and file cabinets from Just You Wait N See’s offices. Local housing officials told the agents they were taking away only housing authority records, but later admitted they had taken some Just U Wait N See financial files and turned them over to federal investigators.
The May incident came shortly after the dissolution of ties between the housing authority and Just U Wait N See, along with the housing authority’s firing of three for-profit contractors it had chosen, in the wake of what housing authority officials acknowledged was the collapse of the agency’s efforts to deliver legally mandated job-training and placement, financial counseling and other services to residents of the Stanton and Frederick Douglass Dwellings – the two public housing complexes razed to make way for Henson Ridge.
The Henson Ridge project has been the target of protests by former residents and the local chapter of the National Association of Minority Contractors, who have charged that despite the millions of tax dollars spent on federally mandated job training and placement, financial counseling and other services to residents, little has resulted.
The Common Denominator reported in June that U.S. Attorney Roscoe Howard’s office acknowledged an ongoing federal-local joint task force investigation into housing projects in the District funded with federal monies, especially those financed through a program called HOPE VI. Henson Ridge is one of five HOPE VI projects in the District, funded with a mix of federal and local tax dollars.
Graham was out at the time agents knocked in the door of her brand new rental townhouse at Henson Ridge. She returned home while agents were searching the house and, Graham later said, was questioned extensively by agents about her group’s finances.
Mary Ann Snow, an official in the Office of the U.S. Attorney for the District of Columbia, said the search warrant was obtained by investigators from the U.S. Department of Housing and Urban Development (HUD) inspector general’s office, working with the U.S. attorney.
Snow said the warrant alleges that on Nov. 6, Graham picked up two checks totaling $34,819 issued to Just U Wait N See by the D.C. Department of Housing and Community Development (DHCD), later illegally removed two fellow board members as designated signatories for Just U Wait N See bank checks, and substituted a new signatory without board approval. The warrant names LaShawn Porter as the new signatory.
Graham and Porter, the warrant alleges, then signed off on at least two checks, totaling $28,880, drawn on Just U Wait N See’s bank account. Those checks were allegedly written to Mary Hammond, a contractor to the organization who, sources said, wrote a grant application. The warrant cites a document showing that Hammond was owed only $3,400, Snow said.
Porter and Hammond could not be reached for comment.
In an interview at her home last week, Graham acknowledged picking up the two checks on Nov. 6 from DHCD, the D.C. government department through which federal HUD funds are disbursed. She said she deposited the checks to Just U Wait N See’s SunTrust Bank account either that day or the next.
She also acknowledged changing the established checking account signatories and said she installed Porter as a new signatory. She described Porter as a Just U Wait N See board member. She said she had other board members’ approval for her actions.
Graham said she then wrote checks to two contractors owed money by Just U Wait N See. She declined to say who the contractors were, or to give the amounts of the checks she wrote, citing the contractors’ right to privacy. She again denied any financial impropriety.
"I haven’t done anything unethical," she said.
But Just U Wait N See Vice President James Jackson disputes Graham’s actions. In an interview with The Common Denominator, Jackson said he was one of the two designated signatories that Graham allegedly improperly removed from bank records. Sources close to the investigation said it was Jackson’s complaints to authorities that led federal agents to assemble the evidence against Graham cited in the search warrant for her home.
Jackson said Graham asked him to sign a check written to Hammond for $22,000. He said he refused.
"I knew Mary Hammond wasn’t owed any $22,000," he said.
Jackson said he phoned officials at DHCD, which disbursed funds to his organization, when he suspected something was wrong. But he said he got little response.
"They said Brenda had a right to pick up those checks," he said. "They said there was nothing they could do."
Jackson said he then called the HUD inspector general’s office and local police.
Robert Trent, DHCD’s chief of staff, said he took Jackson’s call. Trent confirmed that he told Jackson that since he believed his agency had followed proper procedures in releasing the checks to Graham, he couldn’t take further action. He said he notified DHCD Director Stanley Jackson of James Jackson’s allegations against Graham, but did not alert law enforcement officials.
Shortly afterward, investigators from the HUD inspector general’s office visited DHCD and reviewed Just U Wait N See’s files.
DHCD officials confirmed that Graham on Nov. 6 picked up two checks from the agency – one for $11,772 and the other for $23,047. The payments were described as the agency’s final payouts on two grants to Just U Wait N See, for job training and placement services and for housing counseling provided to displaced public housing residents.
Two days after the raid on her Henson Ridge townhouse, Graham stood in her living room, which was still littered with splintered wood and plaster fragments from her shattered front door and door frame. She decried the evidently flimsy nature of the building materials used, and the investigators’ decision to forcibly break into her home.
"I’ve always cooperated with these investigators," she said, referring to the joint task force members. "I just spoke to (an agent) about financial records on Wednesday. There was no need to do it this way."
Snow downplayed connections between the raid at Graham’s townhouse and the broader task force’s work.
"If this matter evolves into a broader investigation, or if what is discovered as a result of this search warrant leads us to other individuals, we’ll pursue those directions," she said. "It’s too early to draw any conclusions."
Copyright 2003, The Common Denominator