Convicted of fraud, ex-NC housing authority leaders remain on nonprofit’s staff and board

Two women convicted in federal court of fraud while working at the Chatham County Housing Authority continue to hold key positions at a locally and federally funded nonprofit that helps low-income residents.

Central Piedmont Community Action Inc., based in Siler City, assists people in Chatham, Durham, Orange and other counties with services that include a federally funded housing program.

JoAnn Johnson Davis, who manages that program, pleaded guilty in May 2023 to defrauding the U.S. Department of Housing and Urban Development (HUD) out of over $200,000 while working as the Housing Authority’s executive director.

Davis, 65, was hired for the case-manager job at Central Piedmont Community Action in the time between her guilty plea and her sentencing Feb. 8 to 30 months in prison for conspiracy to commit wire fraud. She was ordered to pay $194,136 in restitution and is scheduled to start her prison sentence on April 3.

One of the co-defendants who pleaded guilty to conspiracy to commit wire fraud at the Housing Authority under Davis is Clintess Barrett. She was sentenced to four years probation and was ordered to pay $57,179 in restitution, according to the U.S. Attorney’s Middle District Office.

Barrett, 55, has remained as the chair of the board of directors of Central Piedmont Community Action as of this month. An updated March 2024 brochure on the nonprofit’s website states Barrett is the nonprofit’s board chair.

Reached by phone, Barrett declined to speak with The News & Observer.

Both women were terminated from their jobs at the Housing Authority last year after an investigation by the HUD Office of the Inspector General, although a spokesperson declined to provide the termination dates.

Chatham County ‘reviewing the matter’

In a statement, Karen Howard, vice chair of the Chatham County Board of commissioners, said the county is “reviewing the matter to assess the validity of these claims and will take appropriate actions if warranted.”

“The County also places great importance on the integrity of these organizations and ensuring that they foster trust within the community and among the individuals they serve,” Howard said.

Howard was chair of the county board in 2023 when the Housing Authority leaders were federally indicted.

Central Piedmont Community Action received $10,000 in state grants and $42,908 in American Rescue Plan funds through the county for its Rapid Re-housing program, according to the county manager.

Natasha Elliott, the nonprofit’s executive director, oversees its staff of five people. She did not respond to calls and emails from The N&O for this story.

The board overseen by Barrett determines the pay of employees, including Elliott’s.

Amber Cole, the nonprofit’s personnel director and executive assistant, also declined to comment and directed hiring questions to Elliott.

Elliott knows Davis and Barrett from her work as the board chair for the Chatham County Housing Authority, a position she’s held since Davis was in charge. She was appointed to the board in 2017 by the Chatham County Board of Commissioners.

According to a federal 990 form for fiscal 2021-22, Central Piedmont Community Action reported total revenues of $2.59 million, total expenses of nearly $2.64 million and (negative) net assets or fund balances of $-255,849.

Working at nonprofit after convictions

As housing case manager for the Housing Opportunities for Persons With AIDS program (HOPWA), Davis oversees a HUD-funded program, despite being convicted of misusing HUD funds.

The program serves residents diagnosed with HIV or AIDS, or family members with at least one person in the household with HIV or AIDS, who make 80% or less of the area median income. HUD awards hundreds of millions of dollars to states and cities across the U.S. for HOPWA programs.

Prosecutors knew about Davis’ current employment when she was sentenced, according to a spokeswoman for the U.S. Department of Justice.

Davis declined to speak to a reporter from the N&O this month while at her Durham office in the NCWorks Career Center.

After The N&O’s inquiries into her employment, her name was removed this month from the HOPWA section on the Central Piedmont Community Action website.

However, a brochure dated January 2024 that includes her name as housing case manager is still accessible on the website.

The HUD Office of Inspector General is aware of Davis’ and Barrett’s association with the nonprofit but had no further comment, according to a HUD spokeswoman.

”I think the fact that they’re working at this nonprofit calls into question (its) credibility,” Whitney Schmidt, a former Siler City landlord, said in an interview. “I feel like this puts an already critical housing situation in the county at even more risk. This certainly seems like poor judgment at best ... at worst, an egregious breach of trust in the community.”

Schmidt leased a duplex to tenants with Section 8 vouchers from 2017 to 2022, and raised various complaints about the Housing Authority under Davis’ leadership. The staff missed appointments for inspections, communicated poorly and “constantly” tried to find reasons to end her tenants’ leases, she said.

She eventually sold her property, she said, because it became too difficult to continue renting under the Section 8 voucher program.

Federal indictments allege conspiracy

Davis was federally indicted in February 2023, along with Barrett and three other Housing Authority employees, on charges of conspiring to defraud HUD from 2016 to 2020.

Davis is related to Barrett and two of the other defendants who were indicted:

▪ Mi’Chelle Bell-Johnson, who was sentenced to three years probation and $83,877 in restitution.

▪ Robert Johnson Jr., whose charges were reduced to a misdemeanor charge of false statements to HUD with intent to defraud and was sentenced to two years probation and $7,677.50 in restitution, court documents show.

Co-defendant Candace Brunson-Poole’s charges were also reduced to a misdemeanor count of theft of government property. She was sentenced to a year of probation, $929 in restitution and a $500 fine.

All told, Davis was convicted of abusing her position at the Housing Authority to make payments to at least 13 of her friends and relatives.

The scheme involved bid-rigging, prosecutors said.

Bogus job contracts for services like lawn care and cleaning within the Housing Choice Voucher Program (Section 8) were awarded to friends and relatives who submitted bids for the contracts. Those bogus proposals competed with fraudulent ones fabricated by co-conspirators who used stolen identities and company letterheads, prosecutors said.

“JoAnn Davis was entrusted to spend money intended to help improve the lives of others,” FBI special agent in charge Robert DeWitt said in a news release. “She abused that trust by misusing the government funding to enrich her own life and the lives of her family and friends.”

It resulted in the Housing Authority paying out hundreds of thousands of dollars for work that was not done and Davis then taking a cut of the money.

After she accepted a plea deal last year, she was terminated from her job.

Links to Durham Housing Authority

Davis’ and Barrett’s professional connection precedes their time working together in Chatham County.

They worked together at the Durham Housing Authority from 2006 to 2011, until they were both fired on the same day.

According to termination letters requested by The N&O, Davis and Barrett both were terminated on the same day, Sept. 14, 2011.

Another employee named Anne Graham was also terminated from the DHA that day. Graham was listed this month as the sole HOPWA housing case manager at Central Piedmont Community Action’s website.

According to a letter from then executive director Dallas Parks, Davis was investigated for violating different ethics and procurement policies at Durham Housing Authority and her “abrasive management style.” Davis was found to be in a conflict of interest for hiring Bell-Johnson, her niece, as a contractor, who would go on to be one of her co-defendants convicted for fraud.

NC Reality Check is an N&O series holding those in power accountable and shining a light on public issues that affect the Triangle or North Carolina. Have a suggestion for a future story? Email realitycheck@newsobserver.com