Federal officials are sounding alarm bells about potentially dishonest vendors sucking millions of taxpayer dollars away from storm victims through billing fraud. Meanwhile, records show Florida continues to award and pay tens of millions of dollars in disaster recovery funds to one firm recently implicated in a federal civil settlement over fraudulent billing practices. Worse, the payouts have continued without a single audit conducted by Florida officials, even after the results of the federal investigation became known.
While Governor Ron DeSantis and newly installed Chief Financial Officer Blaise Ingoglia announced new initiatives this week to crack down on local government waste and abuse – there’s no clear indication whether or not those efforts will include audits of the massive disaster recovery payouts, worth hundreds of millions of dollars in state and local funding, and particularly one company implicated in a fraudulent invoice scheme.
In May, federal investigators working for the Department of Housing and Urban Development released a scathing report that showed Horne LLP, a disaster recovery services firm with major contracts in Florida, had submitted falsified invoices for similar work conducted in West Virginia. But whether or not a similar scheme took place in Florida remains unknown, in large part because Florida officials have yet to conduct an audit of the company’s performance, even though the contracts allow for such audits.
Federal agents looking into Horne’s dealings in West Virginia found that the company had faked some of the work, submitted falsified records, or simply billed for work without any evidence that it was actually completed. Investigators say the company charged state taxpayers $950 each for “personal consultations,” which investigators described as little more than phone calls supported by “fictitious signatures” and faked personal information. The investigators, working for the HUD Office of Inspector General, also alleged that Horne billed $1,850 per home inspection, even for vacant lots or completely undamaged properties, and submitted repair estimates of $1,650 each for homes that required no repairs whatsoever.
Alarmingly, the same company has contracts in Florida to help storm victims after several major hurricanes. Horne has already submitted more than $80 million worth of invoices to the state of Florida over the last several years, yet to date, not a single audit of those contracts has been conducted by Florida officials, even after news of the West Virginia scheme came to light. The firm currently holds $583 million worth of contracts with the State of Florida, including a single contract valued at over half a billion dollars managing Florida’s Hurricane Ian Housing Recovery Program. According to state records, over $56 million has been paid out under that contract so far, and all of it without an audit.
The federal investigation centered in West Virginia ultimately led to a civil settlement in which Horne agreed to repay $1.2 million in damages. The report concluded that the company’s fraudulent activities “undermine the mission of HUD’s disaster recovery efforts and take critical resources away from those who need them most.”
It’s not clear how much money has been paid to Horne from local governments in Florida, nor how closely local officials may be scrutinizing their work. But with the new push by DeSantis and Ingoglia to crack down on wasteful government spending, Florida officials with responsibility for managing taxpayer funds are likely to be more cautious when it comes to disaster recovery contracts.
