Louisville Housing Commission is missing $17 million in Section 8 funds, lawsuit says

Lina Portman2 weeks ago

0 2 minutes read

A former Louisville Metro Housing Authority employee claims the agency is missing up to $17 million in Section 8 funds. And after raising concerns about unaccounted funds to federal officials, he was fired.

The plaintiff, Matt Swain, is now suing the housing authority, claiming retaliation under the Kentucky Whistleblower Act.

He joined the authority in April 2020 as supervisor of safety, security and investigations and was later promoted to manager of OSHA/safety, security and investigations, according to court documents. Around late April or early May, a deputy director informed Swain of the alleged missing Section 8 funds.

Section 8 vouchers are awarded to low-income people by the federal government and can be used to cover all or part of a person's rent. Renters must pay 30% of their adjusted gross income for rent and utilities.

In his lawsuit, Swain said he contacted a representative of the U.S. Department of Housing and Urban Development, which oversees the public housing agencies that distribute the vouchers, and relayed his knowledge of the mismanaged funds.

About four days later, Swain said he was suspended without pay, citing job performance issues. The suit calls the performance problems “fabricated.”

About two weeks later, on May 29, Swain was fired.

This was not the first time Swain expressed concerns about his observation of the “waste and mismanagement” of funds, according to the lawsuit. In February, during a Zoom call with HUD members, Swain mentioned that widespread subletting was occurring at LMHA properties, a form of fraud. Afterward, the suit claims that executive director Elizabeth Strojan told Swain not to discuss subletting.

“She said, 'You're not talking about subletting anymore.' And so he says, 'Well, you know, that doesn't sit well with me, I'm going to talk about subletting again,'” said Swain's attorney, Tom Coffey.

Jailen Leavell, LMHA public information officer, said the housing authority has committed no wrongdoing and is dedicated to a positive work environment.

“While we cannot discuss the specifics of the pending legal matters, we would like to emphasize that LMHA has not committed any wrongdoing and will vigorously defend itself against all allegations,” he wrote. “Our agency is committed to providing a fair and respectful workplace for all employees, and we will address this issue through the appropriate legal channels. We remain committed to upholding our values and ensuring a supportive work environment.”

Coffey, however, said the Kentucky Whistleblower Act was created for situations like this.

“It is designed to protect people who raise concerns, complaints and concerns about government waste, abuse of authority, fraud and security,” he said. “If people are afraid of not being able to come forward, it will only encourage them to do more mismanagement, to abuse their power more, to commit more fraud and to put more people's lives at risk from the point of view of from a security perspective.”

Before joining LMHA, Swain was a Chicago police officer for 27 years. He is suing for retaliation and seeking compensation and his employment.

Contact reporter Eleanor McCrary at [email protected] or @ellie_mccrary on X, formerly known as Twitter.

Lina Portman

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