The Nonprofit Behind Billions in Mortgage Aid Is a Mess

Bloomberg Businessweek reports:

Hoping to deliver relief to Americans pounded by the financial crisis, the government has poured billions of dollars into a sort of Red Cross for homeowners.

NeighborWorks America, a nonprofit chartered by Congress, distributes much of that money to counseling groups that dispense mortgage advice and sometimes financial aid.

A close look at the group reveals a house in disorder -- with sweetheart contracts, document fudging and unexplained departures of top officials.

Executives at the group awarded at least two large jobs to insiders without bidding, later justifying one of the contracts with a backdated memo, according to interviews with former employees, tax filings and previously unreported company audits. In the other case, managers signed off on a multimillion-dollar technology deal to a recently formed contractor, which had board members in common with NeighborWorks and used the same law firm. The contractor overcharged by as much as 20 times, one of the audits said.

Then, with little fanfare, four top officials left NeighborWorks over a few months last year, under the watch of a board of directors that includes administrators from the Federal Reserve and the Department of Housing and Urban Development.

An article well worth your time.