Drexel cooperating with PHA probe

Federal investigators have questioned Drexel University about work done by the Philadelphia Housing Authority's former executive director, Carl R. Greene, and his private consulting business to develop a new degree program.

The inquiry is part of an ongoing criminal probe of the housing agency during Greene's tenure.

Drexel spokeswoman Lori Doyle said in a statement last week that the U.S. Attorney's Office in Philadelphia had requested from Drexel "certain information relating to Carl Greene and CRG."

"Drexel is cooperating fully with the government's investigation and has been informed that neither Drexel nor any of its employees is being investigated," Doyle said in response to questions from The Inquirer.

In addition to questions about the consulting business, investigators have been looking into contributions that the PHA made to Greene's pension, according to four people familiar with the situation.

Clifford Haines, an attorney for Greene, declined to answer questions about Greene's work for Drexel or pension contributions.

He cited the fact that Greene has sued The Inquirer for defamation in Common Pleas Court. "As long as there is litigation between Mr. Greene and the Inquirer he cannot/should not answer questions from you," Haines wrote in an e-mail reply.

PHA's commissioners fired Greene in September 2010, stating he had settled three sexual-harassment complaints without their knowledge or approval.

Their decision came shortly after media reports about Greene's personal financial problems. In July 2010, Wells Fargo Bank foreclosed on his luxury home, and in December 2009, the IRS placed a lien of $52,000 on his property for taxes from non-PHA income earned from 2002 to 2006. Greene paid his overdue mortgage payments and back taxes.

Greene, who was making $306,370, ran the housing authority from 1998 until 2010.

He sued the PHA in federal court, arguing that under his contract, the agency had no cause for firing him and owed him as much as $1 million. After five days of testimony last February, the PHA and Greene agreed to settle the dispute, with the agency paying him $625,000.

After Greene's departure, federal authorities launched a broad investigation of various aspects of the housing authority.

Through his outside business, CRG Consulting, Greene helped Drexel develop a residential property management degree program in the university's Goodwin College of Professional Studies, Doyle said.

In 2009, Drexel launched two degree programs: bachelor's and master's degrees in property management, and an undergraduate credit certificate in residential and commercial property management.

Doyle said Drexel had no ongoing consulting or any other relationship with Greene or his business.

She would answer no further questions.

"Because this is an ongoing investigation by the U.S. Attorney, it would not be appropriate to comment further at this time," she said in a statement.

The Inquirer had asked the university about the amount paid to CRG Consulting, the duration of the work, and whether Drexel had any other business relationships or transactions with PHA or Greene.

Federal agents have questioned PHA staff about whether any employees worked on Greene's outside business, such as the Drexel work, on agency time, according to people familiar with the investigation.

They said investigators had also asked about special pension contributions for Greene and senior managers that were made after 2008.

At the time, the stock market was collapsing.

For certain senior managers, including Greene, the PHA made "discretionary" contributions in 2009 and 2010 for them to buy credit for years of service for defined benefit pension plans, according to sources.

For tax reasons, each recipient received a check made out directly to him or her.

Since the funds were earmarked for defined benefit plans, employees were then required to deposit the money into their pension accounts and were given credit for their years of service, the sources said.

At the PHA's board meeting in January, the authority's current chief executive, Kelvin Jeremiah, said the payments to the senior managers had not been "properly authorized." He received approval from PHA's sole commissioner, Estelle Richman, to recapture the funds.

At least seven employees, including Greene, had received a combined $400,000 in pension contributions.

Another issue that has drawn scrutiny from the U.S. Department of Housing and Urban Development is the housing authority's spending on outside lawyers.

From 2007 until 2010, the PHA spent $38.5 million on outside lawyers, more than any other housing agency in the country, HUD said.

Following a critical audit, HUD's office of inspector general wants the PHA to reimburse a significant portion of those federal funds. The matter is under negotiation.