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hicago's largest landlord, Pangea Properties, allegedly overcharged tenants with Section 8 vouchers, potentially costing the city's housing authority upwards of $1 million per year. An investigation by the Chicago Housing Authority (CHA) in 2015 found evidence of this practice but was dropped without a full analysis. The matter is now being litigated in a whistleblower lawsuit filed by Antoni Muhawi, which charges Pangea with defrauding the government and seeks damages.
The lawsuit claims that Pangea had an internal policy to quote voucher holders $150 more per month than market-rate tenants, then lied on paperwork to hide this practice. CHA officials found that 42 out of 52 analyzed units were overpaying by "upwards of $4,000 each month." If the same rate applied across all 1,130 units with vouchered tenants, it would mean a loss of over $1 million per year.
CHA's decision to drop the investigation has raised questions about whether the agency looked the other way to continue working with its largest housing provider. The lawsuit alleges that Pangea employees withheld information and set up roadblocks to make data analysis more difficult.
The case highlights broader issues within the Housing Choice Voucher program, where landlords often overcharge tenants and receive tens of millions in government payments they're not entitled to. A Washington Post investigation found similar problems across the nation, with some housing authorities unknowingly or knowingly overpaying landlords.
Experts say that the system relies on self-reporting from property owners, which can lead to "overvaluing properties beyond what the actual market might bear" and creating a "distorted market" in neighborhoods where voucher holders are concentrated. This has led to poorly maintained buildings and inflated rents, making housing less affordable for those without vouchers.
The lawsuit against Pangea is one of several recent controversies at CHA, including allegations that the agency leased public land to a soccer club without proper review and allowed publicly owned units to sit empty during an affordable housing crisis.
