A former property manager from Glenburn, Maine, was sentenced in federal court for embezzling funds from an organization that received federal support and for conspiring to alter money orders. U.S. District Judge John A. Woodcock, Jr. sentenced Kelly Ballinger, 59, to five years in prison and three years of supervised release. Ballinger must also pay about $1 million in restitution after pleading guilty on May 1, 2024.
Court documents state that Ballinger managed a Portland apartment complex whose residences were funded by the U.S. Department of Housing and Urban Development (HUD). Between October 2015 and June 2021, she stole rent payments made by tenants participating in HUD’s Housing Choice Voucher Program. She instructed tenants to make rent payments using blank postal money orders and then filled out her own name or that of her subordinate employee, Kathleen Conway, as the payee. In some cases, she wrote “groceries” on the memo line to disguise the nature of the payment as a reimbursement. Ballinger also underreported tenants’ incomes so HUD would cover a larger portion of their rent.
Kathleen Conway pleaded guilty to embezzlement and was sentenced on June 6, 2024, receiving two years of probation and an order to pay $35,710 in restitution.
Judge Woodcock commented during sentencing that Ballinger was “able to concoct a scheme that avoided detection for years.” He described her actions as “calculated, deliberate, and devious.”
The case was investigated by the HUD Office of Inspector General (OIG) and the U.S. Postal Inspection Service.
“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 OIG. “HUD OIG will continue to work with its law enforcement partners to diligently pursue and hold accountable bad actors who willfully misuse federal assets.”
“The U.S. Postal Inspection Service routinely seeks prosecution of individuals like Kelly Ballinger, who swindled funds that were designated to support fellow community members with housing,” said Ketty Larco-Ward, Inspector in Charge of the U.S. Postal Inspection Service, Boston Division. “Postal Inspectors, alongside HUD OIG, uncovered the fraud schemes employed by Ballinger and her co-conspirator, to conceal her activities and line her pockets. We will continue to support and collaborate with our federal law enforcement partners to stop those who are engaged in these types of schemes.”
