EXECUTIVE DIRECTOR OF THE SCRANTON HOUSING AUTHORITY INDICTED

Martin C. Carlson, Acting United States Attorney for the Middle District of Pennsylvania, today announced that a federal grand jury sitting in Harrisburg, Pennsylvania returned a 16-count indictment against David Baker, age 60, the Executive Director of the Scranton Housing Authority. The indictment charged Baker with obstructing a federal audit, obstruction of a criminal investigation, false statements, wire fraud, and theft of federal funds.

The indictment charges that Baker, as Executive Director of the Scranton Housing Authority, took federal money intended to fund low income housing for the poor and misapplied the money to non-federal middle income housing. The indictment noted that the misapplication had originally been discovered by auditors, and Baker had been told that the practice was illegal and that it must immediately stop. Baker agreed to cease misapplying the funds. As soon as the agreement was finalized, Baker again began to misappropriate federal funds for illegal purposes. In order to cover the misapplication of funds, Baker made misrepresentations to auditors and submitted false statements to the U.S. Department of Housing and Urban Development.

The indictment further charged that, when employees of the Scranton Housing Authority began to cooperate with investigators and auditors, Baker retaliated against them by taking away overtime job assignments. In one case, Baker threatened an independent auditor to change his report to HUD or he would harm the auditor. In another case, Baker made threats against any employee who would cooperate with federal investigators. Baker made these threats because he was aware that he was violating numerous federal statutes in his running of the Scranton Housing Authority and did not want the facts to come to the attention of federal authorities.

The indictment also charges that Baker misused his office to underpay laborers, to ignore the federally mandated eligibility list by placing friends and family members into choice federally-funded housing locations, and to take away overtime as punishment for cooperating with federal investigators.

United States Attorney Carlson stated, “The purpose of federally funded housing is to provide shelter for America’s poorest citizens. There is a critical need to ensure that the money set aside for that purpose is not misapplied by those entrusted with the duty of managing those funds.” “More to the point,” Carlson added, “one responsible for overseeing the housing authority cannot be permitted to retaliate against those who have been asked to cooperate in an investigation by federal officers.”

The case was investigated by the Office of Inspector General of the U.S. Housing and Urban Development. Assistant U.S. Attorney Gordon Zubrod has been assigned to prosecute the case.

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An Indictment or Information is not evidence of guilt but simply a description of the charge made by the Grand Jury and/or United States Attorney against a defendant. A charged Defendant is presumed innocent until a jury returns a unanimous finding that the United States has proven the defendant’s guilt beyond a reasonable doubt or until the defendant has pled guilty to the charges.