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A former Worcester housing official has been convicted by a federal jury for her role in allowing the city to pay $2.3M to a multifamily developer for work that was never done.
Jacklyn Sutcivni, the former director of housing for Worcester’s Housing Development Office and Executive Office of Economic Development, allowed taxpayer dollars to go to developer James Levin between 2010 and 2011, a federal jury found Tuesday. Levin, who applied for the funds through three separate U.S. Department of Housing and Urban Development programs, pleaded guilty last year to federal fraud charges and was sentenced in March to 37 months in prison.
"This guilty verdict reinforces the message that our communities will not tolerate those who undermine the administration of precious HUD dollars earmarked for the creation of affordable housing for our citizens,” HUD Office of the Inspector General, Northeast Region special agent in charge Christina Scaringi said in a statement.
Levin purchased the 5 May St. apartments in 2010 for $435K and made seven requests for federal and state housing grants, claiming he redeveloped the 19K SF, 13-unit apartment building. Sutcivni approved the combined $2.3M in payments on behalf of the city despite knowing they were fraudulent, prosecutors charged.
Sutcivni and other city employees then submitted reimbursement requests to HUD and the Massachusetts Department of Housing and Community Development. A Worcester official took oversight of 5 May St. from Sutcivni in 2012 and inspected the apartments, finding little of the alleged redevelopment had been completed, according to the 2016 indictment.
Sutcivni denied wrongdoing in testimony Monday and blamed other city officials for the wrongdoing, the Worcester Telegram reported. Prosecutors said Sutcivni, during the time of the scheme, bought a condo from Levin to circumvent a city residency requirement.
Worcester, which assumed ownership of the apartment building, sold the building in 2016 for $48K to Vader Realty, an amount far below its assessed value. Vader Realty sold the property last year for $585K to Worcester-based Kensington Management, according to Worcester County land records.
The wire fraud charge carries a maximum sentence of up to 20 years in prison, and prosecutors are seeking forfeiture of $2.3M from Sutcivni, according to an indictment. U.S. District Court of Massachusetts Judge Timothy Hillman will sentence Sutcivni in December.
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