Summary

In response to a congressional request, GAO examined the Department of Housing and Urban Development's (HUD) actions to determine if they addressed previously examined internal control issues and recommendations concerning allegations of abuse of HUD-insured mortgage loans.

GAO found that HUD: (1) took significant steps, consistent with earlier GAO recommendations, to discourage fraud and abuse in its single-family mortgage insurance program; (2) should identify fraudulent and abusive practices more frequently and quickly; (3) improved its targeting of reviews of mortgagee origination practices; (4) took action to verify appraisals of investor-owned properties that it had previously owned and should also verify appraisals on properties that it had not previously owned; (5) no longer requires that Veterans' Administration property appraisal data be included in the file documentation for insurance commitments; and (6) failed to issue instructions requiring independent verification of credit reports showing no previous credit history.