Can I be Criminally Charged in Massachusetts for Improperly Receiving Subsidized Housing?

In an interesting decision delivered today, the Massachusetts Appeals Court upheld the larceny conviction against a man who had passed along his government subsidized apartment to an illegal immigrant who did not qualify for the subsidy.  The name of the case is Commonwealth v. Alvarez

The defendant applied for subsidized housing through the Boston Housing Authority.  His application was approved and he became entitled to a rental apartment below market rate.  However, there was no apartment available at the time his application was approved and he languished on a waiting list for nearly five years.  By the time an apartment became available, the defendant had obtained another apartment.  Instead of rejecting the subsidized apartment, the defendant gave it to his niece, who was an illegal immigrant and accordingly did not qualify for public housing.  The defendant paid rent for the subsidized apartment and pretended he was living in the unit (he was required to reapply on a yearly basis).  Ultimately the Commonwealth discovered the defendant’s scheme and indicted him for two counts of perjury and one count of larceny by false pretenses.  The defendant pled guilty to the two perjury indictments and elected to have a jury-waived trial before a superior court judge on the larceny indictment.  The judge found the defendant guilty of larceny.  She sentenced him to serve five years of probation, pay a $25,000 fine, and pay restitution in the amount of $14,639.  The defendant received concurrent probationary terms for his perjury convictions.  The defendant appealed his larceny conviction.

On appeal, the defendant argued that he had not stolen “property” as defined by the Massachusetts larceny statute.  While property includes money, a deed, a conveyance of land, or a valuable contract, the defendant asserted that a lease is not encompassed by the definition.  The Appeals Court disagreed.  The Court pointed out that the defendant did not obtain an ordinary apartment by his false statements.  Instead, he was given something of value for which he didn’t pay – the difference between a market rate for an apartment and the subsidized rate provided by the Boston Housing Authority.  The Court said but for the defendant’s misrepresentations about his financial situation and his intention to live in the apartment, he would not have received the lease.  The Court concluded the Housing Authority had parted with a valuable commodity (a below-market apartment rental) by reliance on the defendant’s lies.  In this circumstance, the elements of larceny by false pretenses have been satisfied.  The Court also rejected the defendant’s argument that he should not be punished because he faithfully paid rent for the unit, because the rent paid by the defendant did not represent the true worth of the apartment.

The defendant won a minor victory when the Appeals Court ruled the trial judge’s restitution order was improper.  The judge ordered the defendant to pay $14,639, which was the difference between the rent for a comparable market-rate apartment and the rent paid by the defendant.  The Appeals Court concluded the Commonwealth did not prove the Housing Authority had actually lost any money by the defendant’s fraud, and the restitution amount was therefore erroneous.

This is an important reminder that fraud related to social services (whether it be welfare, food stamps, or subsidized housing) can result in criminal charges and accompanying criminal penalties.