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State alleges Miami developer ‘cheated’ to get federal housing funds

HTG is accused of submitting 15 applications for federal funds through various “shell” companies

The staff at Florida’s state housing agency has accused one of the largest affordable-housing developers in the state, Housing Trust Group, of cheating in a recent procurement of tens of millions of dollars in federal housing resources in Miami-Dade County.

The allegations stem from a cap set by the Florida Housing Finance Corporation on the number of applications that a single developer could submit for a share of the funding.

HTG is accused of bypassing the three-application cap by submitting applications through various “shell” companies owned by individuals that are related to HTG by blood, marriage, or ongoing business relationships.

The company is suspected of submitting 15 applications in all, with the application fees for each company being paid with consecutive checks from the same bank account.

HTG’s application strategy has been called “inappropriate” and “cheating” on the record by a state staffer because of suspected collusion with relatives and business partners.

The alleged collusion enabled HTG to thwart state regulatory limits on both the number of requests and the amount of funding requested, according to statements made by Florida Housing Finance Corporation staff in a recent series of public meetings and legal proceedings.

The agency discussed the matter during a June board meeting, where board member Sandra Einhorn called for “clear consequences” for “bad actors.”

The discussion offered a glimpse of the trouble brewing for Miami-based HTG, which bills itself as the “#1 Affordable Developer in Florida” and boasts of a national presence including in Tennessee, Arizona, and Texas.

HTG has recently completed a development in Miami in partnership with Miami Heat player Alonzo Mourning, and won a recent award from Miami-Dade County of a large piece of land on the edge of the booming Wynwood neighborhood in Miami.

HTG is a client of the high-profile lobbyist Ballard Partners, and a frequent contributor to federal and state political candidates.

It is unclear whether the Florida Housing Board, whose members are appointed by the Governor, will delve deeper into the alleged impropriety at its July 17 meeting.

Sources familiar with the matter say agency staff and some board members are seeking a formal inquiry to determine whether the owner of HTG, Matthew Rieger, colluded with relatives and business partners, including his father, to defraud the state procurement process.

The inquiry, if validated, could result criminal charges for violation of state and federal procurement laws.

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