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"Someone has taken advantage of the kindness:" Audit requested after homes sold in city of Milwaukee

MILWAUKEE (CBS 58) -- A Milwaukee Alderman says the city of Milwaukee was scammed and is calling for action.

Alderman Khalif Rainey wants all city-owned properties that have been sold to non-profits to be audited. He's requesting this after a fake organization bought vacant homes with the intent of putting them to good use but in fact, sold them for a sizable profit.

"The audit will reveal any inefficiencies and any red flags for the city of Milwaukee to improve the business that we do," Alderman Khalif Rainey of the 7th district said. 

CBS 58 News obtained deeds that show several sales between Inner City Development Project Incorporated and the city of Milwaukee.

Each for $1,000 between April of 2016 and now.

Inner City Development sold a home just a week after they bought it from the city and made a $44,000 profit.

Another has been sold three different times since the city sold it.

Alderman Rainey says the company used to have a proper license but learned it was expired during the transactions.

"Someone has taken advantage of the kindness that's presented by this opportunity to purchase a property for $1,000. They used it to exploit and that's a concern for me and the people I represent."

The Department of City Development Commissioner Rocky Marcoux released a statement saying in part,

Working with the Department of Neighborhood Services and the City Attorney's Office, we have referred individuals who have intentionally committed fraud for prosecution. Given the volume of properties in the city's inventory, it's in the best interests of our residents and neighborhoods to do all we can to stop transactions involving individuals who are seeking to profit at taxpayer expense.

The comptroller says the city's audit staff is booked for the year but he plans to have internal meetings to see how to proceed from here. 

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