FORT MYERS, Fla.- The Housing Authority of the City of Fort Myers Housing Authority has uncovered $70,000 in unreported income for public housing tenants from the last 12 months. 

"We are literally collecting thousands of dollars that the housing authority has overpaid in rent, meaning taxpayer money," Housing Authority Director Sherri Campanale said.

Rent for Section 8 or Public Housing clients is calculated based on income.  The formula involves:  six consecutive months of pay stubs, six consecutive months of food stamps, six consecutive monthly bank statements, and a tax return for the previous year.

"What's happening is there are clients who are filling out a tax form are getting large rebates.  They are declaring that they have businesses and income that the housing authority was not aware of," Campanale said.

Last year, a study led by a Tampa Police attorney and three specialized detectives found 80-90% of tax fraud was committed by people on public assistance.

Campanale estimates the housing authority has lost $10,000-$15,000 in the last two months alone.

Campanale is confident the agency will recover the money.

"There's a lot of things that are going to get past us, but in time, we'll find them out when it comes time to renew their lease or a new client coming in," she said.

If you're in Section 8 or Public Housing and caught committing fraud, you can face up to $10,000 in fines and up to five years behind bars.

If you're caught committing fraud by the I.R.S., it's a mandatory three year jail sentence.