False Claims Act Used in Florida Section 8 Housing Cases

Two landlords accused of shaking down low-income tenants for excess rent payments were recently sued under the federal False Claims Act. According to the U.S. Attorney for the Southern District of Florida and Legal Services of Greater Miami, the landlords George David Horton, a pastor at Greater New Bethel Baptist Church, and John Joseph, unlawfully received excessive rent subsidies from low-income tenants Sabrina Newberry and Taronda Wade.

According to the government, Horton and Joseph both participated in the United States Department of Housing and Urban Development’s (“HUD”) Housing Choice Voucher/Section 8 (“Section 8”) program. Through Section 8, HUD distributes federal funds to local public housing agencies, such as the Miami-Dade Public Housing and Community Development, to assist eligible low income families with obtaining decent, safe, and sanitary housing in the private rental market. The government claims that when Horton and Joseph applied to receive federally subsidized rents, they contractually agreed to charge only the rent authorized by the Miami-Dade Public Housing and Community Development.

According to the government, Horton and Joseph charged Wade and Newberry additional “secret” rents over and above the Section 8 subsidy, and threatened eviction for non-payment. Wade and Newberry, both originally represented by Legal Services of Greater Miami, each filed whistleblower actions under the qui tam provisions of the False Claims Act. The whistleblowers alleged that Horton and Joseph violated the False Claims Act by charging and accepting excessive rents in violation of HUD rules.

The federal government intervened in both of Newberry’s and Wade’s qui tam actions.

Horton agreed to pay $50,000 in settlement of the lawsuit originally brought by Newberry. Of the settlement amount, the whistleblower Sabrina Newberry will receive $5,377, plus her attorney’s fees, under the qui tam provisions of the False Claims Act.

In the action against Joseph, Judge Marcia Cooke granted the United States’ Motion for Summary Judgment and awarded $35,194 to the government and $4,398, plus costs and attorney’s fees, to whistleblower Taronda Wade.