Dive Brief:
- A former Chicago Housing Authority property director allegedly received more than $421,000 in bribes in exchange for the fraudulent concession construction company owner of more than $4.8 million in construction and renovation work at CHA properties, according to a June 9 indictment in U.S. District Court, Northern District of Illinois, Eastern Division.
- The indictment accuses Ryan Ross, formerly director of the CHA’s Property and Asset Management Department, of receiving the funds in 2023 and 2024 from Vanessa Rhodes, president of Chicago-based Bell’s Better Buildings, which did business as Twenty Eleven Construction.
- In return, Ross used his official position to direct contracts to that company and another company affiliated with Rhodes, according to the indictment. Multifamily Dive reached out to Ross and Rhodes for comment, but did not hear back by press time. An indictment formally begins the criminal prosecution process, but is not proof of guilt.
Diving knowledge:
The indictment charges Ross, 50, of Bolingbrook, Illinois, and Rhodes, 47, of Chicago, with eight counts of honest services fraudeach punishable by up to 20 years in federal prison, according to a June 9 news release from the Northern District of Illinois attorney general’s office. Arraignments in federal court in Chicago have not yet been scheduled.
CHA, the nation’s third-largest public housing agency, develops and operates housing throughout the city for low-income families, seniors and people with disabilities, primarily through federal HUD funds. However, it has experienced ups and downs in recent years.
The agency was without a leader for a year and a half until Keith Pettigrew, former head of the Washington, D.C., housing authority, was appointed CEO in April despite objections from Chicago Mayor Brandon Johnson, WTTW reported. Residents also filed a lawsuit accusing the CHA of violating the state’s Open Meetings Act when it voted in March to appoint Pettigrew.
As part of his role at the agency, Ross supervised CHA property managers and worked with them to prepare units for new residents, select vendor companies for that unit shift work and approved invoices.
Ross and Rhodes concealed their scheme, including Ross’ financial interest in the unit shift work he awarded to Twenty Eleven Construction and the affiliated company, by submitting false documents to the CHA, including proposals, scopes of work and invoices, according to the indictment. Ross and Rhodes also allegedly caused Rhodes’ husband to falsely represent himself to CHA property managers as an employee of the affiliated company who would complete work on the CHA units.
Less than two years ago, Ross was fired for violating CHA proceduresincluding one that cost the agency more than $19,000 in unnecessary expenses for construction work, the Chicago Sun-Times reported.
Andrew Boutros, US Attorney for the Northern District of Illinois; Machelle Jindra, special agent in charge of HUD’s Office of Inspector General; and Kathryn Richards, Inspector General of the CHA, announced the indictment.
Corruption in the awarding of public housing contracts undermines trust, distorts competition and diverts scarce resources, Boutros said in the statement.
“Holding people accountable when they exploit their positions for personal gain is essential to protecting the integrity of our public institutions, ensuring that taxpayer funds are properly protected, and ensuring that everyday people who need public housing assistance receive the support they are entitled to under the programs,” Boutros said.
Click here to sign up to receive multifamily and apartment news like this article in your inbox every weekday.
