Paul Thompson, development director at Hove-based Chichester Housing Association, has quit his job and other resignations may follow.

The association has blamed "poor investment decisions" for the situation.

It means multi-million pound projects to build more than 100 new homes for the needy have been suspended indefinitely.

Schemes affected include the second stage of the Phoenix Brewery development and work in College Place, Trafalgar Street and Richmond Place in Brighton and St Aubyns in Hove.

The homes were due to be built at an estimated cost of £8 million.

An investigation has found some staff breached the association's rules as well as procedures laid down by the Housing Corporation.

Chairman Maurice Willard said: "Some of these decisions are likely to result in our having to write down the value of some projects and sites."

The Housing Corporation has suspended grants for any uncommitted schemes. But work already under way, including the £3 million rebuilding of Portland Gate in Hove and the £2.7 million scheme in Princes Street, Brighton will continue.

Mr Willard added: "They have also confirmed that there is no evidence of financial impropriety.

"It is serious for us, but the fault was really one of over-enthusiasm. We have grown fast in recent years and success has brought its problems."

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