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The Associated Press

WASHINGTON (AP) — The government is reviewing a program that has allowed more than 3,800 police officers and teachers to buy homes at half price in economically depressed neighborhoods after auditors found widespread abuses.

A report by the Department of Housing and Urban Development’s inspector general found that a sample audit of home sales found that about 20 percent of the home buyers in four selected cities violated at least some requirements in the program.

The department estimated that as many as a fourth of the participants in the nationwide program may have broken some rules such as one that requires a purchaser to live in the house for at least three years.

John C. Weicher, assistant secretary for housing, said that HUD plans to examine all 3,800 loans granted through the Officer Next Door and Teacher Next Door programs. The agency will have “no tolerance for fraud or program abuse,” he said in a letter to the inspector general.

The agency has given $158 million in discounts to law officers and teachers with no proof the program has met its goal “to strengthen America’s distressed communities and create safer neighborhoods,” Nancy Cooper of the inspector general’s office wrote in the report.

The law officer program was created in 1997 and the one for teachers in 2000. Participants may buy HUD-owned homes in poor neighborhoods with down payments as low as $100.

In exchange, they agree to live there.

The inspector general found vacant and rented houses in Miami, Manassas, Va., Memphis, Tenn., and Springfield, Mass. Twenty-three of 108 buyers did not live in their houses. In some cases, they already owned a home or quickly sold their new HUD house, the review found.

HUD suspended the programs this spring after a preliminary report from the inspector general and the string of convictions. The programs are scheduled to restart Aug. 1, with new controls.

Copyright 2001 Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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