Work Time Spent at Casinos, on Tennis Court Sends Federal Housing Exec to Prison

June 29, 2010 - KANSAS CITY, KS—A $141,000-a-year executive at the Department of Housing and Urban Development’s (HUD's) office in Kansas City, Kan., has been sentenced to 12 months and a day in federal prison for taking pay for hours he did not work, U.S. Attorney Lanny Welch said today.

The sentence also includes two years of supervised release, a $2,000 special assessment, and $46,925 in restitution to HUD.

In March, a jury found Herman S. Ransom, 53, Olathe, Kan., guilty on 10 counts of wire fraud and 10 counts of theft of public funds. During a trial in U.S. District Court in Kansas City, Kan., prosecutors presented evidence that federal investigators kept Ransom under surveillance for 32 separate days while he went to casinos and/or played tennis during hours he was paid to work. Investigators compiled and analyzed records from the Overland Park Racquet Club and casinos in Kansas City to determine that between 2001 and 2007, Ransom collected $46,925 in pay for hours he did not work.

As Hub Director of HUD’s office in Kansas City, Kan., Ransom was responsible for supervising approximately 89 employees in Kansas City, Kan., St. Louis, Des Moines, Omaha, Tulsa, and Oklahoma City. His duties included overseeing the Office of Multifamily Housing for Kansas, Missouri, Iowa, Nebraska, and Oklahoma. As a GS-15 level supervisor, Ransom’s working hours were set at 8 a.m. to 4:30 p.m. He certified on pay reports that he worked 40 hours a week when in fact he knew he had taken personal time off during work hours. The false reports were sent electronically from Kansas City, Kan., to the National Finance Center in New Orleans, La., for processing and payment.

Welch commended the Department of Housing and Urban Development - Office of Inspector General, the Federal Bureau of Investigation, and Assistant U.S. Attorney Tris Hunt for their work on the case.