LOUISVILLE, Ky. (WDRB) — A whistleblower claims millions of federal dollars are missing from the Louisville Metro Housing Authority.
According to the lawsuit, $17 million in federal Section 8 money is unaccounted for. Section 8 funds are used to house low-income families, the disabled and older people. When the whistleblower brought this to the attention of federal officials, he was fired.
"If people can't come forward with that, it is never going to get cleaned up," Thomas Coffey, attorney who filed the lawsuit on the whistleblowers' behalf, said.
According to this lawsuit filed in Jefferson Circuit Court, Matt Swain, the now former supervisor of OSHA Safety, Security and Investigation was told by an unnamed LMHA deputy director that as much as $17 million of Section 8 money was unaccounted for.
Swain took that information to a federal employee, and within four days of doing so, he was suspended without pay. He was fired two weeks later.
“You have to allow for state and government employees to be able to report what government waste, it is abuse of authority, it is fraud they must know, they have protection when they go up the chain and they disclose these things,” Coffey said.
Swain served on the Chicago Police Department for 27 years, and was hired at LMHA as Safety, Security and Investigation supervisor and eventual became manager of the department.
According to court documents, Swain was alarmed at the fraud, waste and mismanagement throughout the agency, including a form of fraud that is pervasive among LMHA properties called subletting.
“He went to his director, and the director said don't talk about subletting anymore Matt, then made a disclosure to a field representative, a federal field representative from HUD, he raises that issues and in a couple weeks he is fired,” said Coffey.
LMHA Public Information Officer Jailen Leavell sent WDRB News the below statement Thursday afternoon:
"There are no missing or unaccounted-for funds at LMHA. All funds are properly accounted for and documented within the Authority’s annual Financial Audit. However, the computation for the use of the Housing Choice Voucher Section 8 funds was previously incorrect and is currently under review. In March 2024, our agency announced that our Housing Choice Voucher Program, also known as Section 8, would undergo an external audit.
"The ongoing audit is comprehensive, and any alleged unaccounted-for funds would have been identified during this process. We expect the audit to be completed in the coming weeks. Additionally, the Housing Choice Voucher program has recently been overseen by new leadership."
Coffey said Swain wants justice.
"And there is no way this is going to get turned around if people that raises issues whether it is abuse of authority or whether it is simple mismanagement of funds, if people can't come forward with it, it is never going to get cleaned us," Coffey said.
Swain is also asking for his job back, along with lost benefits and compensation.
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