Jerry Martin and Seth Hyatt of the law firm Barrett Johnston Martin & Garrison, representing whistleblowers in a federal lawsuit, announced the resolution of the case that alleged developers had defrauded the U.S. Department of Housing and Urban Development (HUD). Under the False Claims Act (FCA), individuals with knowledge of fraud on a government program can file a qui tam lawsuit and share in the recovery as a reward for bringing the purported fraud to the government’s attention.

In their lawsuit, the whistleblowers alleged that Defendants manipulated a HUD program intended to increase the stock of affordable housing in cities such as Nashville. Specifically, the lawsuit alleged that Defendants concealed their status as property developers and falsely certified an intention to occupy the homes as primary residences—rather than develop or “flip” them. Under HUD rules, this gave Defendants an opportunity to bid prior to the bidding opening up to developers and investors.

The Department of Justice, through the local United States Attorney’s Office, lead the investigation and resolved the litigation on behalf of the taxpayers. The Defendants have agreed to pay the government $200,000 to resolve these claims. The Defendants are also banned from participating in HUD programs for a period of time.

“This HUD program was intended to increase the stock of affordable housing, something that is desperately needed in Nashville,” said Jerry Martin who represented the whistleblowers. Mr. Martin, who was appointed by the President to serve as the United States Attorney from 2010-2013, now represents individuals who come forward to expose fraud on government programs.

If you know of fraud on a federal or state program and are thinking about coming forward, contact our firm to confidentially discuss your options.

Read The Tennessean’s coverage of the settlement here.

To learn more about our Whistleblower & Qui Tam practice click here. Our firm is located in Nashville, Tennessee but we represent whistleblowers all around the country. Call us today at (615) 244-2202.