Thompson Construction to Pay $191,000 for False Claims in West Virginia Flood Recovery

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Thompson Construction to Pay $191,000 for False Claims in West Virginia Flood Recovery

West Virginia – Thompson Construction Group Inc. has agreed to pay $191,070 to settle allegations that it violated the federal False Claims Act by submitting false claims for federal disaster recovery funds and falsely certifying that homes it built met contract requirements, Acting U.S. Attorney Lisa G. Johnston announced today.

The case stems from the 2016 catastrophic flooding in central and southern West Virginia, which destroyed thousands of homes and killed at least 23 people.

Following a presidential disaster declaration, Congress allocated Community Development Block Grant – Disaster Recovery (CDBG-DR) funds through the United States Department of Housing and Urban Development (HUD) to assist low-income residents in rebuilding their homes.

Thompson Construction was awarded contracts to rebuild flood-damaged homes, which included specific requirements for water management systems such as crawl space drainage and sump pumps to prevent future flooding.

However, an investigation revealed that the company failed to install these required systems while falsely claiming compliance and receiving federal funds.

As part of the agreement, Thompson will pay $95,535 in restitution and $95,535 in double damages under the False Claims Act.

“West Virginia families relied on Thompson Construction to rebuild their homes, only to be left vulnerable to future flooding,” stated Acting US Attorney Johnston. “This settlement ensures accountability for misusing taxpayer funds.”

HUD-OIG Special Agent-in-Charge Shawn Rice criticized the company’s actions, stating, “Thompson Construction diverted federal resources meant for flood victims to line their own pockets.”

The West Virginia Commission on Special Investigations was instrumental in exposing the fraud, collecting photographic evidence and interviewing homeowners and contractors. Commission Director Rick Eplin praised the collaboration with HUD-OIG and the US Attorney’s Office for achieving the resolution.

Authorities are still committed to protecting federal funds and holding those who try to take advantage of disaster recovery efforts responsible.

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