MEMPHIS, Tenn. — Seniors at Serenity Towers will finally see change with the new year.
The Memphis Housing Authority is now in charge, taking over from the troubled Millennia, and residents are set to be relocated.
“This could have and should have been done long ago,” said Tennessee Representative G.A. Hardaway.
Meanwhile, we learned Millennia, the Ohio-based company that failed to pay its bills and violated rules, leaving residents in unsafe conditions, is firing back at federal housing regulators, claiming they’re violating the law.
We asked Representative Hardaway what his thoughts are on the possibility that Serenity or Millennia could sue the city of Memphis or HUD. He responded, “I say go ahead.”
WREG’s Alex Coleman posed the question to State Rep. G.A. Hardaway, and the WREG Investigators discovered that’s exactly what’s happened.
Millennia is suing HUD, asking a federal judge for an injunction to stop the federal housing agency from bringing any more administrative proceedings, litigation, or hearings against Millennia and its leader Frank Sinito.
“Once we get into the courts, then we’ll start gathering information. I’d love to see Millennia in a situation where they have to produce documents,” said Hardaway.
Documents we uncovered with the lawsuit show it stems from HUD reportedly hitting Millennia with millions in fines.
According to Millennia, during a less than two-month period last year, HUD filed 16 complaints against the company demanding more than $7 million in civil penalties.
HUD says it combed through bank statements and ledgers at one of Millennia’s Ohio properties and found it made “unauthorized distributions” of $169,000, then says the same thing happened at 15 other properties.
Millennia filed the lawsuit against HUD not long after agents from the Inspector General’s Office for HUD and the USDA raided Sinito’s Ohio home.
The company’s lawyers call HUD’s enforcement process “unconstitutional” and say any claims should be “heard before a jury” in federal court, instead of HUD’s in-house Office of Hearings and Appeals.
Millennia also says it’s being punished with penalties that far exceed the “alleged unauthorized distributions.”
Speaking of money, the lawsuit is just one of the documents we dug up.
For nearly a year, we’ve been waiting for HUD to respond to our request for records about alleged financial mismanagement at Millennia. The company’s internal records reveal accusations of millions in missing tax dollars.
A letter sent to Sinito and Millennia levels even more serious accusations, saying nearly $5 million is “missing” or was “improperly taken” from 19 properties.
HUD accuses the company of under-funding tenant security deposit accounts at dozens of properties for a total of more than $400,000, then lists alleged unauthorized distributions totaling $4.5 million.
None of the properties listed were in Memphis, but HUD says that was just a sample and suspected the same thing was happening elsewhere.
Not long ago, WREG Investigators got off the phone with a long-time Serenity resident who said he’s just happy we continue to shine a light on the problems because without it he believes change likely wouldn’t be happening.
An attorney representing Millennia sent the following statement Thursday:
“The court action Millennia Housing filed against the U.S. Department of Housing and Urban Development speaks to a principle older than our country itself: where a party seeks to bring a legal action against Millennia, it is entitled to a trial by jury. HUD is not granting that right to Millennia, so it seeks to have the proceeding halted.
“Beyond this, we will let the filings speak for themselves and we look forward to the court’s consideration.”
Locally, attorneys for Serenity and the City of Memphis head back to Shelby County Environmental Court on January 16.
