The U.S. Department of Housing and Urban Development's (HUD) inspector general, Kenneth M. Donohue, is leaving the department next month to join the private sector. Donohue, who was nominated by President George W. Bush and confirmed by the U.S. Senate in March 2002, will join Bethesda, Md.-based Reznick Group, a firm that provides accounting, tax and business advisory services.
The Reznick Group focuses on real estate, financial services and affordable housing, among other industries. Donohue will focus on compliance, fraud and abuse, and prevention and protection internal controls on behalf of the firm's federal and state and local government clients, the firm says.
During his tenure at HUD, Donoue led the Office of Inspector General (OIG) through the most tumultuous years in the department's history.
Early on, the HUD OIG was at the epicenter of the 9/11 attack on the World Trade Center, when the HUD OIG New York field office was destroyed. Donohue ordered HUD OIG agents from across the country to New York City to assist in the investigation that followed the attack.
When the Gulf Coast region was devastated by hurricanes in 2005, the HUD OIG was called upon to conduct oversight and was instrumental in auditing programs and leading investigations of improper activities.
Eighteen months before the subprime-related crisis, Donohue testified in the Congress to the dangers facing the U.S. mortgage industry and theÂ housing sector. He argued against certain proposed changes in Federal Housing Administration (FHA) practices and programs, which, HUD says, would have likely negatively impacted the FHA insurance fund.
Donohue likewise testified his concerns regarding Ginnie Mae's posture as its portfolio greatly expanded.
Recently, he was one of three chairs, along with the attorney general and director of the Federal Bureau of Investigation, to lead a federal task force to investigate and prosecute individual and corporate fraud. Their joint effort – Operation Stolen Dreams – resulted in more than 1,500 arrests and more than $198 million in recoveries.