Los Angeles Reaches $38.2 Million Settlement over Allegations of Defrauding HUD

According to an article in Whistleblower Network News, the City of Los Angeles has agreed to pay $38.2 million to settle whistleblower allegations that it defrauded the U.S. Department of Housing and Urban Development by falsely certifying homes as accessible to people with disabilities for more than a decade. The suit was filed by a Los Angeles resident who uses a wheelchair and the Fair Housing Council of San Fernando Valley, a nonprofit disability rights advocacy group, reports Geoff Schweller.

The HUD grant the city used to fund construction and rehabilitation of homes in its affordable multifamily housing program mandated that recipients of federal housing development funds comply with federal accessibility laws. However, despite “failures like slopes that were too steep, counters that were too high, and thresholds that did not permit wheelchair access,” the federal government says the City of Los Angeles falsely certified to HUD that the properties were in compliance.

“By failing to make certain that HUD-funded multifamily housing was appropriately built or rehabilitated to meet federal accessibility requirements, the city discriminated against people with disabilities,” the article quotes HUD Inspector General Rae Oliver Davis as saying. Schweller reports that under the False Claims Act’s qui tam provisions, the whistleblowers are eligible to receive between 15-30 percent of the settlement, which has not yet been determined in this case.