Buffalo’s former HUD director comments on FBI search at city hall

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BUFFALO, N.Y. (WIVB) – When FBI agents left Buffalo City Hall with three cartloads of materials while executing a search warrant Wednesday, the former director of the Buffalo field office for the U.S. Department of Housing and Urban Development was paying attention.

HUD officials, as well as Internal Revenue Service officials, joined federal agents on their search of a Buffalo Urban Renewal Agency office in City Hall. Steve Banko ran the Buffalo field office for HUD from 1998 until 2010.

By phone this week, he alleged the City of Buffalo has a history of misusing HUD funds.

“When we approached them about the issues that we found in the spending of the money, then they wanted to fire the messenger instead of addressing the cause of the message,” Banko said.

It’s unknown whether BURA is the focus the public corruption probe the FBI is conducting.

“I have no response to that,” Mayor Byron Brown said when asked to comment on Banko’s allegation. “Literally dozens of improvements, of changes, have been made to the way federal funding is handled. It’s my understanding that there have been numerous audits that have been positive.”

As the city’s mayor, Brown is the chairman of BURA’s board. The agency assists in neighborhood revitalization initiatives in the Queen City, and uses HUD funding to do it. Buffalo Common Councilman Chris Scanlon also serves on BURA’s board.

“I was as caught by surprise as anyone,” Scanlon said Wednesday’s city hall search.

Banko thinks it’s notable that HUD and the IRS were both involved in Wednesday’s search.

“It would point to somehow that money was illegally diverted from the program to somebody or to a number of people that would then have entailed the IRS saying, ‘Well you have this money. You didn’t declare it,'” Banko said.

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