A former Portland property manager was sentenced to five years in prison on Tuesday after she embezzled rent payments from tenants in the U.S. Department of Housing and Urban Development (HUD) Housing Choice Voucher Program for nearly six years.
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“Ballinger and her co-conspirator preyed on the vulnerability of elderly and disabled individuals and altered income and expense documents to falsely increase HUD rental subsidies, which she then funneled to her personal bank account,” said Special Agent in Charge Shawn Rice with HUD Office of the General Inspector.
Kelly Ballinger, 59, reportedly stole rent payments from Section 8 housing tenants in a scheme that lasted from October 2015 to June 2021.
According to court records, Ballinger instructed low-income tenants to pay rent via blank postal money orders. She would then fill in the money orders with her own name as the recipient or the name of her subordinate, Kathleen Conway, 71, who was also charged in connection with the scheme.
Ballinger then added memos like “groceries” to the money orders to make it look as though tenants were reimbursing her.
In order to disguise the theft, she manipulated tenant income numbers on paperwork, making their income look drastically lower than it was in reality in order to get HUD to pay additional taxpayer money to disguise the shortfall caused by the stolen funds.
Ballinger pleaded guilty in May 2024 to embezzling from an organization receiving federal funds and conspiring to alter money orders.
In addition to spending five years in prison, Ballinger will pay approximately $1 million in restitution.
Her co-conspirator, Conway, was sentenced to two years in prison and ordered to pay $35,710 in restitution.
