TRENTON - A report by the New Jersey Comptroller’s Office finds the Low Income Housing Assistance Program (LIHEAP), administered by the New Jersey Department of Community Affairs, paid out improper benefits, failed to verify incomes or identities of recipients, and even paid out benefits to dead people.  

But a Kane In Your Corner investigation finds a whistleblower came forward with many of those same concerns nearly six years ago to several state and federal agencies, raising questions about why it took this long for anyone to act.

Paris McCray, and his mother, Sharon Hussein, both of Trenton, received new furnaces last winter thanks to grants from LIHEAP and the Weatherization Assistance Program (WAP).  Both say they could not have afforded the furnaces on their own. “Home repair is a lot of money,” Hussein says, “so it was a blessing.”

That’s how LIHEAP and WAP are supposed to work. But the comptroller’s report found multiple cases of benefits being paid to individuals whose incomes far exceeded the maximum. The comptroller says that at one agency administering the grants in Middlesex County alone, benefits even went to three public employees, including one who earned more than $90,000. The report also says the NJDCA lacked access to a Social Security database, which “restricted DCA’s ability to fully vet even the most basic eligibility requirement -- that applicants have a valid Social Security number.”

None of this would come as a surprise to Dennis Kerrigan, who came forward as a whistleblower in early 2011, after he says he witnessed fraud while working for a Mercer County agency that administered LIHEAP and WAP. Kerrigan says he saw recipients getting benefits for which they should not have been eligible, including some he believed to be politically connected.

Some recipients “had marble floors and vaulted ceilings and chandeliers,” Kerrigan said. “They didn’t deserve these benefits”.

Documents obtained by News 12 New Jersey under the state’s Open Public Records Act and the federal Freedom of Information Act show Kerrigan told his story to both the New Jersey Attorney General’s Office and the U.S. Department of Energy. The AG’s office closed the case. In a letter to Kerrigan, it said it found “insufficient evidence of a crime.” The Department of Energy referred the case to the Mercer County Prosecutor’s Office, and the prosecutor’s office formally accepted the investigation in an email. Prosecutor Angelo Onofri says his office never received any documents from the feds, but admits his office never followed up.

Update: The New Jersey Department of Community Affairs released a statement about the situation:

“The [Office of the State Comptroller] makes sweeping conclusions about the failure of DCA oversight and management of the program after investigating only one of 17 local agencies and reviewing a tiny fraction of the more than 265,000 program applicants. OSC’s conclusion that the state’s entire LIHEAP process is susceptible to fraud is not only based on a statistically invalid level of testing, but it also is erroneous.

This local agency was in the midst of a change in executive leadership and the DCA has been working closely with it to strengthen weaknesses DCA increased monitoring visits and was fully focused on righting the deficiencies apparent in that agency.”