Saturday, June 14, 2008

Woman accused of Road Home fraud

In the first federal case alleging Road Home fraud, a New Orleans woman was charged Friday with stealing $132,000 in homeowner aid for an Uptown home she did not rightfully own.

A federal grand jury in New Orleans handed up two felony counts against Barbara Simmons Dowl, 46: a count of theft of government funds and a count of wire fraud. She got an $85,930 check directly from the Road Home, financed by U.S. Housing and Urban Development money, and also caused the program to wire the other $46,000 of her grant to the Small Business Administration to pay off an SBA loan in her name, also for the property in question.

If convicted, Dowl faces as many as 30 years in prison, three years of supervised release, a $250,000 fine and possible forfeiture of her property. Contacted Friday, Dowl declined to comment.

In an elaborate scheme first exposed by The Times-Picayune in December, Dowl collected a Road Home grant for property previously owned by Nathaniel Dowl Jr., a man she identifies in court testimony as her ex-husband. Court records show Nathaniel Dowl lost the property in 2004 because of unpaid taxes.

After Hurricane Katrina, Nathaniel Dowl filed a "quit-claim deed" in New Orleans property records, falsely stating the city had sold the property at 8633 Zimpel St. to Barbara Dowl, even though in truth the city had sold it to local landlord and developer Brad Robinson and his wife, Michelle, two years earlier.

The deed is signed only by the supposed purchaser, Barbara Dowl, and not by a city official or the Robinsons. A judge declared it and other documents filed by the Dowls on the Zimpel Street property null and void.

"This is your money. This is my money. This is everybody's money," Brad Robinson said Friday. "There are people out there who deserve Road Home money who didn't get any while it went to people like the Dowls."

Nathaniel Dowl, a convicted thief and forger, faces separate state charges of filing false public records on multiple properties, including the quit-claim deed on 8633 Zimpel St., the one that allegedly helped Barbara Dowl collect the Road Home money.

U.S. Attorney Jim Letten said the federal case remains under investigation. Federal officials are expected to closely follow the state case against Nathaniel Dowl, which is scheduled to resume in Orleans Parish Criminal Court next month, and federal authorities can file a superseding indictment in federal court if they want to add charges or additional defendants.

There is evidence that Nathaniel Dowl was involved in similar schemes with Barbara Dowl. Barbara Dowl testified in an August 2006 eviction case about her role in filing a nearly identical quit-claim deed on another property, owned by Tracey and Oscar Poydras. Under oath in First City Court, she indicated little understanding of the quit-claim deed she signed, said Nathaniel Dowl prepared all the documents and added that she simply did what her ex-husband told her.

Federal officials heralded Friday's indictment as a sign they are serious about preventing fraud in the Road Home program and said there will be more indictments to come.

"This prosecution, although the first in our district, will not by any means be the last," Letten said.

According to Tom Luke, HUD's special agent in charge of investigations in Mississippi and Louisiana, this is the first federal fraud charges for Road Home theft in Louisiana, while a parallel homeowner aid program in Mississippi has yielded 53 indictments, 41 convictions and about $3.6 million in frozen or recovered grant funds.

This is despite the fact that Louisiana's program has paid out five times as many grants as Mississippi's.

Officials ascribe the relatively low levels of Road Home fraud to the maze-like verification measures in Louisiana's program, the policies that also have been blamed for slowing grant payouts.

Although Friday's indictment alleges Barbara Dowl also collected an SBA loan on the property she did not own, she has not been charged with fraud for that because she was living in Atlanta when she applied for the loan and a fraud investigation continues in that district, said Matthew Issman, SBA's special agent in charge in New Orleans.