Federal Investigators Probe Ocean City Housing Authority’s Finances

Federal Investigators Probe Ocean City Housing Authority’s Finances

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A new housing project is planned next to the Bay View Manor complex at Sixth Street and West Avenue.

By Donald Wittkowski

Armed with a newly completed audit of the Ocean City Housing Authority, federal investigators are looking deeper into the finances of the troubled agency following the guilty plea of its former top executive on embezzlement charges.

Bob Barr, a city councilman who serves as chairman of the housing authority’s board, said the agency turned over a packet of documents to the U.S. Department of Housing and Urban Development, including some things that appeared “suspicious” during Alesia Watson’s former reign as executive director.

Barr publicly disclosed during the authority’s board meeting Tuesday evening that he and Jacqueline Jones, who took over as the new executive director of the agency in May, met with an investigator from HUD’s Office of the Inspector General on Monday.

In a related development, Barr said the authority has also reached out to Cape May County Prosecutor Robert Taylor’s office about the possibility of conducting an investigation.

Barr and Jones, citing the sensitive nature of the investigation, declined to elaborate on all of the documents given to HUD, but they did confirm the information included a new audit that analyzed the housing authority’s finances during the time Watson served as executive director.

City Councilman Bob Barr, who serves as the housing authority’s chairman, and Jacqueline Jones, the new executive director, met with a HUD investigator on Monday.

According to Barr, he and Jones gave the HUD investigator anything “they thought was suspicious.” He noted that the probe could become a broader investigation that extends beyond Watson’s embezzling scheme.

“It could go deeper,” Barr said in an interview.

On May 16, the board removed Watson as executive director after she pleaded guilty to embezzling federal housing funds to pay credit card bills for personal expenses.

Watson admitted that she misused two housing authority credit cards to buy 69 MasterCard gift cards between December 2013 and March 2015. The gift cards were used for personal expenses and were also shared by Watson with friends and family members, authorities said.

Watson then used HUD funds administered by the housing authority to pay off the credit card bills associated with her purchase of the gift cards, according to the U.S. Attorney’s Office.

Authorities said between $6,500 and $15,000 was lost in Watson’s embezzlement scheme. Watson, 54, of Galloway Township, is scheduled for sentencing in federal court on Aug. 15 and faces a maximum penalty of one year in prison and a $100,000 fine.

A week after Watson’s guilty plea on May 8, the housing authority hired the Ocean City accounting firm of Ford-Scott & Associates LLC to conduct an audit covering the period from Oct. 1, 2015, to Oct. 1, 2016.

Michael Garcia, a partner with the Ocean City accounting firm Ford-Scott & Associates LLC, discusses the findings of an audit of the housing authority’s finances.

The audit came up with 15 “findings” needing corrective action. Michael Garcia, a partner with Ford-Scott, told the housing authority board members Tuesday that the agency already has 13 of the corrective measures in place. The board approved the audit during its meeting, as well as a “corrective action plan.”

“We’re very happy to see you’ve made strides already to turn the ship around,” Garcia said.

Although the agency remains under investigation, Barr expressed confidence that the housing authority has begun to rebuild itself.

“We’re on the right track,” he told his fellow board members.

When Watson was removed as executive director on May 16, the board also approved a series of reforms to overhaul the authority’s management and financial structure. Among them, a new system was implemented authorizing three authority officials to sign checks, instead of just one. Watson formerly was in charge of signing checks.

In place of Watson, the authority brought Jones on board in May to take over as the agency’s new executive director. Jones, who currently serves as executive director of the Vineland Housing Authority, has assumed the same duties in Ocean City under a shared services agreement between both towns through Sept. 30, 2018.

Barr said Jones maintains an excellent reputation with HUD, giving him even greater confidence of a turnaround at the Ocean City Housing Authority under her leadership.

For the time being, however, the housing authority will remain under “troubled status,” a classification that requires extra scrutiny and oversight by HUD, Barr said.

According to Barr, HUD officials are “very pleased” so far with the steps that have been taken to reform the authority.

“They are very confident in the team that we have in place,” he said.

The Ocean City Housing Authority uses federal funds from HUD to provide affordable housing for low-income senior citizens, families and the disabled at its Pecks Beach Village and Bay View Manor facilities.

Barr, who took over as chairman this year, tried to have Watson removed from her job in March after growing suspicious of the authority’s finances, but was unable to win enough support then from his fellow board members.

Watson became the executive director of the Ocean City Housing Authority in 2013 under a shared services agreement with the Brick Housing Authority, where she held the same position. In May, the board terminated the agreement with Brick, effectively getting rid of Watson to make way for Jones.

Before she was hired in Ocean City, Watson had four previous theft convictions, according to a report in The Press of Atlantic City. She resigned her position as executive director of the Atlantic City Housing Authority in 2007 after the paper disclosed her criminal past.

Barr was unable to explain why Watson was hired in Ocean City, despite her previous theft convictions. He noted that he was not an authority board member at that time.