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Housing nonprofit gets federal work despite CEO's criminal past

Less than a decade ago, William "Bill" Sanchez was paying restitution for swindling hundreds of investors out of millions of dollars.

Today, the felon who spent years in federal prison runs a Clearwater nonprofit organization poised to reap a windfall from federal programs administered by Florida's main housing agency.

UNO Federation Community Services could make tens of thousands of dollars — part of it paid by taxpayers — by counseling struggling homeowners and walking them through applications for federal mortgage relief. UNO was approved to provide such counseling under three separate programs.

Officials of the state-run Florida Housing Finance Corp. said they were not aware of Sanchez's conviction until he disclosed it after learning the Tampa Bay Times had asked for records mentioning him.

"What happened 16 years ago does not define me," Sanchez said in an interview Friday. "What defines me is what I've done for the last 10 years and the thousands of people I've been able to help."

Sanchez was living in Staten Island in 1997 when the Securities and Exchange Commission sued him and another New York man for allegedly cheating investors out of at least $4 million in a foreign-currency trading scam.

The suit, filed in federal court in Manhattan, alleged that the men solicited money from at least 335 investors by promising huge returns but never executed any trades. Instead, they misappropriated the money for personal use and to pay existing investors, the suit said. Both men were subsequently indicted along with two others.

"This scheme was sort of a splinter of another, even bigger Ponzi scheme where Sanchez and his cohorts got their start," said attorney Roland Riopelle, then a federal prosecutor who handled the case.

Sanchez pleaded guilty to conspiracy to defraud, was sentenced to 51 months in prison and ordered with his co-defendants to pay $4.9 million in restitution. Records show he was released to a halfway house in Florida in 2001 and stopped paying restitution in 2005 after he personally had paid less than $10,000.

While still under federal supervision six years ago, Sanchez became a counselor at Tampa Bay Community Development Corp., a large Clearwater nonprofit agency that provides a wide range of services for homeowners.

By last fall, Sanchez had risen to vice president. Reporters often quoted him on Florida's foreclosure crisis.

But the 60-year-old Sanchez left the job in February to become chief executive officer of UNO, a little known nonprofit founded in 1998 to help Hispanics with immigration and other issues.

A few months before Sanchez joined UNO, it began doing business under a new name, Housing Services of Central Florida. It applied to the federal Department of Housing and Urban Development to become a "HUD-approved housing counseling agency."

That designation is required for organizations that want to qualify for the millions in federal grant money available to advise homeowners on loan modifications, reverse mortgages and foreclosure prevention.

The HUD application form states that an organization is not eligible for approval if any employee has been convicted of a crime that "reflects on the responsibility, integrity or ability'' of the agency to do housing counseling.

On Feb. 13, HUD approved UNO's application. Less than a week later, Sanchez, a felon, quit his job at Tampa Bay CDC and moved to the Clearwater agency.

Sanchez said the timing of his job switch was not related to UNO's application.

He said Tampa Bay CDC indicated last fall that it was reducing his job responsibilities. Then, in February, the organization's president told Sanchez that if he was thinking of leaving, he should go.

"So I left,'' Sanchez said. The president has since died and officials at Tampa Bay CDC declined to comment.

UNO's chairman, Ralph "Alex" Emmanuelli, said he has long known Sanchez and was aware of his criminal record.

"I'm about second chances," Emmanuelli said. "He has tremendous skills and has proven very effective.''

As soon as Sanchez came aboard, UNO applied to participate in a $10 million federal program administered by Florida Housing Finance Corp. The program, which aims to provide counseling for at least 10,500 homeowners at risk of foreclosure, will pay UNO and other agencies up to $900 for each homeowner they advise.

Florida Housing also invited Sanchez and UNO to take on homeowners from another program, handing his nonprofit nearly 500 client files from a counseling agency that had closed.

"Would you like to hit the ground running?" a Florida Housing employee emailed Sanchez on June 18.

"Of course we would be happy to assist," Sanchez quickly emailed back.

Cecka Green, a spokeswoman for Florida Housing, said Friday that Sanchez disclosed his conviction to the agency after learning that the Times had requested emails and other records. Florida Housing then "reached out'' to HUD to see if Sanchez's conviction jeopardizes UNO's participation in the mortgage counseling program, which is open only to HUD-approved agencies.

"This gentleman has had a very good career in housing counseling," Green said. "As far as Florida Housing is concerned, once we hear back from HUD we'll take whatever appropriate action we need to."

Sanchez's organization also is being paid to help walk home­owners through the new $50 million ReStart mortgage relief program.

In June, the state housing authority contracted with an Illinois organization, National Community Capital, to reduce the principal on hundreds of delinquent Tampa Bay and Orlando mortgages using a mix of private and federal money. National Community Capital hired three counseling agencies, including UNO, to work with eligible homeowners.

Through UNO's participation in ReStart and other programs, Sanchez and his employees have access to confidential information on hundreds of Floridians. Sanchez said that he has not used "any of that for my personal gain'' and that UNO so far has received less than $10,000 for helping modify ReStart mortgages.

But, he acknowledged, UNO hopes to capitalize on the many federal, state and local housing programs that provide funds for counseling.

This spring it applied for a $26,650 grant from the city of Clearwater to advise first-time home buyers and borrowers at risk of foreclosure. On the application, Sanchez indicated he was working as a loan officer during the time he actually was in prison.

"It's not the kind of thing you put on your resume,'' he said.

Susan Taylor Martin can be contacted at susan@tampabay.com.

Housing nonprofit gets federal work despite CEO's criminal past 09/06/13 [Last modified: Saturday, September 7, 2013 6:57pm]
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