Section 8 discover the wife was dead for 2 years

[Jo W.]

Hi,

I received a letter from Belmont (Sec 8 housing assistance in Buffalo NY) stating they are terminating the assistance as the wife passed away 2 years ago and they want me to pay back the money from the last 2 years (about 7k).

Some background: I inherited the tenants when i bought the property 14 month ago and was not aware that the wife who had the sec 8 assistance past away (the husband made me believe she is in the hospital). 

What are my options? I would never lie to a government agency and i feel like I'm getting "punished" instead of the one who actually lied.