Woman Posing as HUD Representative Charged in Illinois

Rachel Dollar —  February 9, 2016 — Leave a comment

Cynthia Wallace, 45, Chicago, Illinois was charged with posing as a federal housing representative to scam homeowners out of cash.  Wallace was charged with one count of falsely assuming and pretending to be an officer of the United States.  Last month Wallace posed as an official from the “Federal Housing Authority” and “H.U.D.” in numerous phone calls she placed to Chicago-area homeowners, according to a criminal complaint and affidavit filed in U.S. District Court in Chicago.  During the calls, Wallace said the federal government would foreclose on the victims’ homes unless they wired money to a location determined by Wallace.

One of Wallace’s intended targets was a 79-year-old woman from the West Side of Chicago, the complaint states.  Two other targets – a husband and wife from south suburban Harvey – wired more than $3,500 to Wallace, according to the complaint.

Wallace was arrested on January 29, 2016, and appeared in court the following day before U.S. Magistrate Judge Michael T. Mason.  Judge Mason ordered Wallace detained in federal custody, pending further proceedings.  The next court date has not yet been set.

According to the complaint, Wallace – using the alias “Sherry Rice” – told the 79-year-old woman that the woman was entitled to $31,200 from the federal government, but only if the woman first wired $500 to a location determined by Wallace.  If the woman didn’t submit the money, Wallace said the government would foreclose on the woman’s home, according to the complaint.  The woman notified federal authorities, allowing agents to tape-record subsequent phone calls between her and Wallace.  In one recorded call, Wallace told the woman, “We can do whatever we want to do if you’re not compliant,” according to the complaint.  The woman did not wire any money.

Wallace later used a different alias – “Shree Box” – to target the Harvey couple, the complaint states.  Wallace told the couple that they were qualified for a $12,000 “H.U.D./F.H.A. grant” to avoid foreclosure on their house.  In order to receive the purported grant money, Wallace said they had to obtain a home inspection at a cost of $480 – payable via MoneyGram to a location determined by Wallace, the complaint states.  The couple wired the money.  In a series of subsequent phone calls, Wallace told the couple that they could qualify for a larger grant, a low-interest mortgage loan and mortgage insurance if they wired additional funds, according to the complaint.  The couple submitted the additional payments, but then notified federal authorities.

Wallace was arrested when she attempted to claim an additional $1,500 from the couple at a currency exchange on the South Side.  The purported MoneyGram was actually a ruse set up by federal authorities, the complaint states.

Wallace is not employed by the Federal Housing Administration, which is a division of the U.S. Department of Housing and Urban Development.

The arrest was announced by Zachary T. Fardon, United States Attorney for the Northern District of Illinois; Brad Geary, Special Agent-in-Charge of the U.S. Department of Housing and Urban Development’s Office of Inspector General in Chicago; and Michael J. Anderson, Special Agent-in-Charge of the Chicago Office of the Federal Bureau of Investigation.

The government is represented by Assistant U.S. Attorneys Matthew S. Ebert and Maribel Fernandez-Harvath.

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