Skip to main content
Press Release

Tacoma Landlord Agrees to Pay $16,618 for Overcharging Homeless Veteran Tenant and Fraudulently Obtaining Federal Funds

For Immediate Release
U.S. Attorney's Office, Eastern District of Washington

Sunrhys, LLC, a landlord and property management company headquartered in Tacoma, Washington, agreed to pay $16,618 to resolve allegations that it violated the False Claims Act by overcharging a tenant and by fraudulently obtaining federal funds from a federal program designed to provide housing to homeless Veterans.

The United States Department of Housing and Urban Development (HUD) and United States Department for Veterans Affairs (VA) jointly administer the HUD-VA Support Housing (HUD-VASH) program. HUD provides rental assistance for Veterans experiencing homelessness, while VA support services assist homeless veterans in identifying, obtaining, and maintaining housing and other needed support services. At the end of Fiscal Year 2020, approximately 80,000 formerly homeless Veterans were receiving permanent housing through the HUD-VASH program.

“In creating the VA’s predecessor agency, President Abraham Lincoln said that we must ‘care for him who shall have borne the battle,’” said Joseph H. Harrington, Acting U.S. Attorney for the Eastern District of Washington. “No Veteran who has served our country and given everything to protect the safety and comfort of Americans should be himself or herself without the safety and comfort of a home. The HUD-VASH program provides important benefits to homeless Veterans. This settlement is an example of the United States Attorney’s Office for the Eastern District of Washington’s commitment to ensuring the integrity of that program.”

Between July 2019 and April 2020, Sunrhys was a participating landlord in the HUD-VASH program with respect to a Sunrhys rental property in Walla Walla, Washington that Sunrhys rented to Daniel Avila, an eligible Veteran. Each month, Sunrhys collected a portion of the monthly rent for the Walla Walla property from Mr. Avila. Sunrhys then submitted a claim for federal rent support funds for the remainder of the total agreed-upon rent. Pursuant to the Housing Assistance Payment Agreement governing Sunrhys’ participation in the program, Sunrhys was expressly prohibited from seeking or collecting additional rent from Mr. Avila in excess of the eligible amount. The United States alleged that Sunrhys violated the Agreement and the HUD-VASH program requirements by fraudulently overcharging Mr. Avila for monthly rent between July 2019 and April 2020.

Jason Root, Special Agent in Charge at the VA Office of Inspector General, stated, “VA OIG’s joint oversight of HUD-VASH is one of the agency’s highest priorities because of the importance of safeguarding grant programs designed to end veteran homelessness. VA OIG thanks the U.S. Attorney’s Office for the Eastern District of Washington and the HUD Office of General Counsel for their partnership and commitment to protecting at-risk homeless veterans.”

This matter originated when Mr. Avila filed a whistleblower, or “qui tam” complaint in February 2021. When a relator files a qui tam complaint, the False Claims Act requires the United States to investigate the allegations and elect whether to intervene and take over the action or to decline to intervene and allow the relator to go forward with the litigation on behalf of the United States. The relator is generally able to then share in any recovery. Here, the United States intervened in the action contemporaneous with the settlement. Mr. Avila will receive $4,154 of the settlement. Mr. Avila was represented by the Northwest Justice Project, Washington’s largest publicly funded legal aid program, which provides civil legal assistance and representation to low-income people in cases affecting basic human needs such as family safety and security, housing preservation, protection of income, access to health care, education and other basic needs.

“Under the False Claims Act, landlords that overcharge tenants under this program are liable not just to repay the amount that they overcharged their tenants, but for three times the total amount of federal funding that the landlord received in rent support payments plus additional penalties for each month, providing a powerful deterrent to fraud,” added Acting U.S. Attorney Harrington. “I want to especially commend the exceptional investigative work performed by the VA’s Office of Inspector General, Spokane Resident Agency, as well as the excellent work done by the Northwest Justice Project, which represented the whistleblower. Our office will continue to work together with our law enforcement partners, with whistleblowers, and with public interest groups like Northwest Justice Project to hold accountable landlords that abuse critical housing programs.”

The settlement was the result of a joint investigation conducted by the VA Office of Inspector General and the U.S. Attorney’s Office for the Eastern District of Washington, with support provided by HUD’s Office of General Counsel, Office of Program Enforcement and HUD’s Office of Inspector General. The investigation and prosecution for the U.S. Attorney’s Office for the Eastern District of Washington was handled by Assistant United States Attorneys Dan Fruchter and Tyler H.L. Tornabene. The claims resolved by the civil settlement are allegations only and there has been no determination of liability. The case is captioned United States ex rel. Avila v. Sunrhys, LLC, 4:21-cv-5013-TOR (E.D. Wash.).

Updated August 4, 2021