WORLD

US Virgin Islands’ housing authority accused of corruption as federal funding is suspended

Jul 20, 2026, 2:17 PM

FILE - A woman and her children walk past debris left by Hurricane Irma in Charlotte Amalie, St. Th...

FILE - A woman and her children walk past debris left by Hurricane Irma in Charlotte Amalie, St. Thomas, U.S. Virgin Islands, on Sept. 10, 2017. (AP Photo/Ricardo Arduengo, File)
Credit: AP Photo/Ricardo Arduengo

(AP Photo/Ricardo Arduengo, File)

SAN JUAN, Puerto Rico (AP) — The U.S. government announced Monday it suspended funding for the U.S. Virgin Islands’ housing authority after an investigation found widespread corruption, as residents still struggle to recover from two major hurricanes that hit nearly a decade ago.

U.S. Housing Secretary Scott Turner said that nine years after the U.S. territory received $1.9 billion in disaster recovery funding, it has spent only $570,000, less than a third of the funds.

He noted that a HUD investigation found “widespread financial mismanagement, inadequate fraud controls, false certifications and improper payments.” The investigation is ongoing.

“This failure has, to date, deprived Virgin Islanders of roughly $1.3 billion worth of assistance that Congress intended them to have,” stated a July 20 letter that HUD sent to the head of the U.S. Virgin Island’s Housing Finance Authority.

The director for the U.S. territory’s housing authority and its spokesperson did not immediately return messages seeking comment. The authority has the right to appeal the suspension by requesting a hearing.

In a post on X, Turner accused officials with the U.S. Virgin Islands’ Housing Finance Authority of prioritizing “kickbacks over helping families recover from disasters.”

The U.S. Virgin Islands was struck by Hurricane Irma, a Category 5 storm, in September 2017. Roughly two weeks later, Hurricane Maria, also a Category 5 storm, struck St. Croix. The U.S. territory is still struggling to recover from the storms.

In a July 20 letter to the head of the U.S. Virgin Islands’ housing authority, HUD said that its “record demonstrates that it is an abysmal steward of taxpayer funds.”

The investigation so far has found that the U.S. Virgin Islands’ housing authority has completed only two of 95 planned single-family rental rehabilitation projects and zero of 329 single and multifamily housing projects.

In addition, the authority had spent only 2% of its electrical grid recovery funding as of May, the investigation found.

Meanwhile, the Virgin Islands housing authority has spent more than half the grant funds slated for administrative costs, according to the letter.

The authority also is accused of seeking $6.2 million in disaster-related funds that the U.S. Federal Emergency Management Agency had already paid.

The U.S. government also noted that the authority’s former chief operating officer who oversaw disaster recovery programs is in federal prison after being convicted on charges including fraud and money laundering.

Turner wrote on X that the former chief operating officer inflated a lumber contract meant to rebuild hurricane-damaged homes from $3 million to $4.5 million and took a $107,000 kickback “and let the lumber rot in the sun, rendering it useless — a waste of taxpayer funds.”

In February, the executive director of the U.S. Virgin Islands’ housing authority resigned as local legislators questioned why some $4.2 million remained idle as a September deadline to use the funds looms.

At the time, Sen. Kurt Vialet accused the former director of “just sitting there with a smug look.”

“The Housing Finance Authority is not building. You can’t be upset at senators being frustrated,” Vialet was quoted as saying by the St. Thomas Source, a local news site.

Please follow our Community Guidelines

World

FILE - The owner of a shooting range prepares to load bullets in his 9mm semi-automatic handgun for...

Associated Press

US Virgin Islands faces second lawsuit over right to bear arms as Florida resident seeks license

SAN JUAN, Puerto Rico (AP) — Gun Owners of America and Gun Owners Foundation are suing the government of the U.S. Virgin Islands and its police commissioner as a fight over the Second Amendment deepens. The nonprofits are asking a federal judge to allow nonresidents to apply for and be issued licenses to carry concealed […]

2 hours ago

A protestor sits on the hood of a police car during a demonstration demanding educational reforms a...

Associated Press

India protest movement holds capital sit-in as police crack down on demonstrators

NEW DELHI (AP) — Thousands of young protesters were camped on the streets of India’s capital New Delhi on Thursday, defying new restrictions in the latest show of strength for a movement that has become one of the biggest challenges to Prime Minister Narendra Modi’s government. India’s “Cockroach” protests began more than a month ago […]

13 hours ago

Associated Press

Asian shares are mostly higher and Mideast tensions push Brent crude past $96

BANGKOK (AP) — Asian shares were mostly higher on Thursday, while the intensifying war with Iran pushed Brent crude past $96 a barrel. South Korea’s Kospi rose 3.7%, to 7,028.66 as investors’ appetite for stocks related to artificial intelligence revived despite a retreat on Wall Street. Samsung Electronics gained 3%, while memory chipmaker SK Hynix […]

14 hours ago

Associated Press

FBI chief hold talks in Cambodia over closer security cooperation to combat online scam crimes

PHNOM PENH, Cambodia (AP) — FBI Director Kash Patel held talks with Cambodian Prime Minister Hun Manet on Wednesday on joint efforts to combat international online scam operations that cheat victims out of billions of dollars each year. A report issued Tuesday by the United Nations Office of Drugs and Crime estimated that scams caused […]

1 day ago

Associated Press

Bulgarian Parliament approves US use of air base to support Middle East operations

SOFIA, Bulgaria (AP) — Bulgaria’s Parliament on Wednesday backed a government proposal to allow the U.S. military to use an air base in the Balkan country to support U.S. operations in the Middle East, while some expressed concern about becoming involved in the Iran war. The Trump administration has faced pushback from certain other countries […]

1 day ago

Associated Press

Congo’s Ebola outbreak has killed nearly 1,000 people

BUNIA, Congo (AP) — At least 999 people have died from the Ebola outbreak in eastern Congo, according to official data published overnight into Wednesday, a grim toll in what’s already been declared the fastest Ebola outbreak in history. The latest update from Congo’s Ministry of Health shows that as of Sunday, 2,473 cases have […]

1 day ago

US Virgin Islands’ housing authority accused of corruption as federal funding is suspended