Does anyone recall the massive 2001 Enron scandal, when investors lost an estimated $63 billion once investigators discovered Enron officials and auditors at the Arthur Anderson accounting firm used legal loopholes and various accounting tricks to hide billions that had been lost in bad deals and debt from shareholders?
Well, fast forward sixteen years and that scandal doesn’t hold a candle to what the Office of Inspector General (OIG) is reporting regarding the U.S. Department of Housing and Urban Development (HUD).
The OIG report reveals that an audit of HUD‘s 2015 and 2016 consolidated financial statements contained a number of unacceptable “pervasive material errors”, totaling an estimate of nearly $520 billion! Furthermore, it notes that it “contains 11 material weaknesses, 7 significant deficiencies, and 5 instances of noncompliance with applicable laws and regulations.”
If you back up a bit, though, you’ll see that the initial audit of HUD’s 2015 and 2016 numbers revealed so many errors that they needed to be sent back and re-released as “restated consolidated reports.” Due to “weak internal controls,” these initial errors (i.e. – misstatements in financial notes, errors in the statement on budgetary resources, and line item discrepancies) totaled nearly $300 billion…but that was prior to any corrections.
Then, the corrected and restated consolidated financial reports made over $516 billion in corrections to the notes and another $3.4 billion to the financial statement.
Nevertheless, unlike the Enron scandal, or the Trump-Russia FAKE NEWS collusion scandal, there has been little-to-no media coverage of HUD’s blunder.
But then again, this occurred under former President Barack Obama’s watch, so that more than likely explains it. Had it occurred under Trump’s, the media would be all over it like white on rice.