The U.S. Department of Housing and Urban Development is conducting a criminal probe that is examining the consulting firm led by former Housing Authority of New Orleans Executive Director David Gilmore, who was brought in to right the troubled agency in 2009, HUD’s Office of the Inspector General has confirmed.
According to the OIG, HUD’s Office of Investigations is scrutinizing Gilmore Kean Consulting, a Washington, D.C.-based firm whose principal, Gilmore, ran the local Housing Authority for five years ending in April. HANO also is part of an investigation by the office, the OIG said.
The Inspector General’s Office did not provide details about the nature of the investigation. It is not clear whether the inquiries into Gilmore Kean and HANO are related.
The investigation was revealed in a response to a public-records request sent to HUD by The New Orleans Advocate. The request was for documents submitted to or collected by the inspector general related to Gilmore, the Gilmore Kean firm, the Housing Authority of New Orleans and former HANO Finance Director Ron McIntyre between 2012 and 2014.
In a July 21 response, the Office of the Inspector General said it would not release the information because the requested documents “relating to the Gilmore Kean Consulting and the Housing Authority of New Orleans are part of an ongoing law enforcement investigation.”
In a follow-up email dated Aug. 18, the HUD OIG said the parties had been investigated by its Office of Investigations.
“At this time, we cannot give you a date as to when a final decision on any release or enforcement proceeding will be made,” the Inspector General’s Office said in its July letter.
The HUD inspector general looks into “possible violations of laws or regulations in the administration of HUD programs and activities, or misconduct on the part of HUD employees and/or the recipients of HUD funds,” according to its website. The office employs investigators, auditors and others who look into allegations of criminal and civil violations.
Gilmore said last week that he had not been notified of any investigation. He said he was “absolutely astonished” by the news.
“This is the first I’m hearing of it,” he said. “I’m completely unaware of it.”
Gilmore Kean was contracted by the U.S. Department of Housing and Urban Development to lead HANO from 2009 until this past April. Under the arrangement, Gilmore served as HANO’s executive director and one-man board of directors. He left the agency in April after his contract expired.
The New Orleans Advocate reported in July that Gilmore, toward the end of his tenure, repeatedly authorized thousands of dollars in professional-services contracts to companies, some with ties to his private consulting firm, through a little-known nonprofit subsidiary of the authority called the Crescent Affordable Housing Corp.
Records obtained by the newspaper showed that CAHC wrote checks and completed wire transfers totaling nearly $1 million to five companies between 2012 and 2013 without first soliciting bids for the work.
In response to the story, HANO’s new executive director, Gregg Fortner, last month announced that the agency would begin developing new procedures to govern CAHC’s financial transactions and procurement practices.
Fortner, the former head of the Florida housing authority who took over as HANO’s executive director in July, said he, like Gilmore, was not aware of any OIG investigation.
“HANO has not been notified or contacted, formally or informally, regarding any investigation by the OIG into HANO activities,” Fortner said in a statement.
Gilmore and HANO also have been targeted in a federal lawsuit filed by the agency’s former finance director, McIntyre. He alleges that he was subjected to a hostile work environment and eventually fired last year for speaking out against the contracting practices adopted by Gilmore.
In his suit, McIntyre said he was “subjected to constant and repeated harassment, threats of termination, sexual harassment, sexual discrimination, racial discrimination and retaliation.” He said his work environment became hostile after he complained that Gilmore was circumventing state and federal bid laws by steering contracts to friends and acquaintances.
Gilmore has denied those claims.