CHARLESTON, W.Va. – In a shocking revelation, Horne LLP, a professional services firm from Ridgeland, Mississippi, has agreed to pay $1,207,600 to resolve civil allegations that it received improper payments from federal disaster recovery grant funds in connection with disaster recovery services it provided in 2017 and 2018 in West Virginia.
The allegations stem from the 2016 flooding in West Virginia, which resulted in historic flooding and left thousands of residents homeless. Following a presidential disaster declaration, Congress appropriated funds for disaster recovery in West Virginia to be administered by the U.S. Department of Housing and Urban Development (HUD) in the form of Community Development Block Grant – Disaster Recovery (CDBG-DR) funds.
Horne was selected by the West Virginia Development Office (WVDO) to develop the state’s Action Plan for use of the disaster recovery grant funds. Although the contract provided for total compensation of $900,000, additional task orders were added, inflating the cost of the contract to more than $18,000,000.
The RISE program, which was re-branded as “Rise West Virginia Housing Restoration Program” (WV-HRP or “RISE”), came under scrutiny in late 2017 when Horne’s contract was reviewed by the West Virginia Department of Administration Purchasing Division. During the review, it was discovered that Horne’s original contract price had ballooned from $900,000 to more than $18,000,000 without competitive bidding, review, or approval by the WVDAPD or the West Virginia Attorney General’s Office.
Horne submitted an invoice totaling $6,739,575, and the invoice was paid on November 6, 2018, from the federal CDBG-DR funds. After Horne transmitted its project data to state officials, investigators discovered that many of the services sold to the state were problematic. In particular, investigators discovered that many of the “personal consultations,” included on Horne’s invoice at $950 each, were for cold calls that resulted in a finding of “no unmet need.”
Defendant: Horne LLP
Criminal Charges: Disaster Recovery Scam
City and State: Charleston, West Virginia
Date: 2018
Sentence or Outcome: Agreed to pay $1,207,600
Dollar Amounts: $1,207,600, $900,000, $18,000,000, $6,739,575, $950
Related Federal Cases
Key Facts
- State: West Virginia
- Category: White Collar Crime
- Source: DOJ Press Release â†â€â€
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