Fraud unit working to protect RI taxpayers

PROVIDENCE, R.I. (WPRI) -- Every year, the Providence Housing Authority helps provide a home to 20,000 Rhode Island families, senior citizens, and the disabled. And every year, criminals are cheating the system; stealing your tax dollars from the people that really need it. That's where the fraud unit comes in.

Despite Hollywood’s glamorous depiction of investigators cracking down on crime, real life investigations are a little different. They rely on "The good old-fashioned paper trail," as Fraud Investigator Jack Costa puts it.

Costa and his partner Daniel Murphy are former police officers charged with tracking down the people milking the Providence Housing Authority of several hundred thousand dollars every year.

"Fraud has always been viewed as a victimless crime," says Costa, "but it hurts the city, it hurts the state and it hurts the country."

We've learned the team has investigated nearly 700 cases of fraud since 2008. We dug deeper and found some disturbing details. In one case, a man allegedly spent 12 years cheating the system to the tune of $60,000. In another, a woman is charged with falsifying documents for over a decade and receiving Section 8 housing that cost taxpayers thousands each year. Both violators were arrested, and are now facing charges from the U.S. attorney's office.

"We are averaging well over $100,000 every year," says Costa.

Nearly $600,000 has been recouped so far. But we've learned that number could be astronomically higher; in the millions even. But for that to happen, investigators need to get the tools to overcome a major roadblock.

"Investigations have come to a complete stop because of our inability to get necessary information from other agencies," says Costa.

The team of two relies on more than a dozen other agencies throughout the state for records that help them pinpoint fraud. In many cases, those records are unavailable with the current system.

"What we're doing with Providence Housing and the state of Rhode Island is we're helping them share data with each other," says Ken Block, the president of Simpatico Software Systems. We've learned his company is creating a computer program that will make those vital records easily available to fraud investigators. "The whole idea of these efforts," says Block, "is to make sure that the dollars are being spent for their intended purpose. And whenever you have people taking advantage of the system, that definitely removes money from the people who need it."

Investigators tell us the new system could help them save millions of tax dollars. Officials tell us there is no set timeline for when this new system will be in place, but say several legal hurdles have already been cleared. We're told all of this is being implemented at no cost to the state of Rhode Island.

To report a case of housing fraud, visit the Providence Housing Authority's website.