Owner Pays $15,000 to Resolve Allegations It Collected Excess Rent

The U.S. Attorney's Office from the Western District of Texas recently announced that an owner agreed to pay the United States $15,000 to resolve allegations that it violated the False Claims Act, 31 U.S.C. §§3729-3733, by collecting excess rent from a tenant in the Housing Choice Voucher program. 

The context: Section 8 is a program to assist low-income families, the elderly, and the disabled in securing decent, safe, and sanitary housing in the private market. Through this program, HUD provides funding by vouchers administered by local public housing agencies. HUD pays the housing subsidy directly to the landlord, which may cover all or a portion of a tenant’s monthly rent. As a condition of receiving the housing subsidy, the owner contractually agrees not to charge the tenant rent that exceeds the amount set by the public housing agency.

Here, the owner leased property to certain tenants participating in the Section 8 program. The settlement resolves allegations that from November 2017 through January 2019, the company violated the False Claims Act by knowingly requiring one of those tenants to pay rent that exceeded what was contractually allowed.

One level deeper: The settlement resolves allegations contained in a lawsuit filed by a former tenant under the “qui tam” or whistleblower provisions of the False Claims Act. The False Claims Act permits private parties to file suit on behalf of the United States and share in any recovery. The claims resolved by the settlement are allegations only and there has been no determination of liability.

HUD's Office of Inspector General investigated this matter along with Assistant United States Attorney from the U.S. Attorney’s Office for the Western District of Texas. The qui tam case is docketed as United States ex rel. Elissa L. White and Elissa L. White, individually, v. 2011 Bandera Road, LLC, Cause No. 5:20-CV-488, (W.D. Tex.).