HUD outlines IT modernization plan to reduce improper payments and prevent fraud

The U.S. House Committee on Financial Services convened on April 8, 2025, to address critical issues surrounding the Department of Housing and Urban Development (HUD) under the theme "Decades of Dysfunction: Restoring Accountability at HUD." The meeting focused on the need for significant reforms to enhance HUD's operational efficiency and accountability.

The discussion began with an overview of HUD's extensive portfolio, which impacts every community in America through hundreds of billions of dollars in grant funding and trillions in mortgage insurance. The committee highlighted the importance of a skilled workforce, efficient processes, and modern technology to manage HUD's vast programs effectively. Despite recent progress in financial and human capital management, HUD continues to face challenges, particularly in modernizing its IT systems.

A significant concern raised was HUD's inability to maintain the necessary capacity to address pressing challenges, particularly the modernization of its IT infrastructure. The current systems hinder HUD's ability to collect and leverage data effectively, which is crucial for monitoring program performance and ensuring proper fund allocation. This inadequacy has led to difficulties in preventing improper payments and fraud, with HUD unable to estimate the extent of improper payments in its largest rental assistance programs, which accounted for approximately $50 billion in 2024.

The committee emphasized that better data collection and IT modernization are essential for improving performance and accountability. The discussion included the need for HUD to proactively manage fraud risks and enhance its anti-fraud practices. Secretary Turner expressed a commitment to strengthening these practices and ensuring accountability among program participants.

As the meeting progressed, members of the committee engaged in a dialogue about the potential benefits of IT modernization, including improved efficiency in fund allocation and enhanced oversight of program activities. The chair underscored the importance of constructive discussions aimed at identifying problems and implementing solutions to improve HUD's operations.

In conclusion, the meeting underscored the urgent need for HUD to modernize its IT systems and enhance its fraud prevention measures to protect taxpayer funds and improve program outcomes. The committee expressed its readiness to support HUD in these efforts, aiming for a more accountable and effective housing and urban development framework.