CHARLESTON, WV (WCHS) — A Mississippi-based accounting and professional services firm has reached a $1.2 million settlement to resolve allegations of improper payments from federal disaster recovery grants for services provided to West Virginia flood victims in 2017 and 2018, federal prosecutors said.
Horne LLP collaborated with the West Virginia Development Office to develop a plan of action following historic flooding that displaced thousands of residents in 2016, according to a news release from the United States Attorney’s Office for the Southern District of West Virginia.
According to the news release, after a presidential declaration authorized disaster relief funding, Horne entered into a contract worth $900,000, but the firm added task orders, increasing the contract value to more than $18 million.
The additions prompted Horne to be tasked with organizing a housing rehabilitation effort known as “Rise West Virginia Housing Restoration.” According to prosecutors, state administrators discovered the contract price was inflated without a review, bidding process, or attorney general approval.
Prosecutors said that after state administrators declared the work orders illegal, Horne sought to sell the data it had generated in West Virginia to the federal government for a price that would cover its services, submitting a $6.7 million invoice that was paid through the Community Development Block Grant Disaster Recovery fund.
After project data was transferred to state officials, investigators discovered problems with the services.
According to prosecutors, the invoice listed $950 in “personal consultations” for cold calls to homeowners who did not require the firm’s services, and Horne created applicant files for each call, which included fictitious social security numbers and birthdays, as well as forged signatures on legal documents.
Investigators discovered that nearly 50 property inspections, each costing $1,850, were for vacant lots. Investigators also discovered that Horne had added more than 70 estimates at $1,650 each for properties that needed no repairs.
Prosecutors said Horne agreed to pay $1,207,600 to settle the civil allegations.
