The V.I. Housing Finance Authority and two of its top executives were named in a whistleblower suit filed this week by former Chief Operating Officer Stephanie Berry.
According to the complaint, filed in V.I. Superior Court by attorney Lee Rohn, the authority “will stand to lose millions of dollars through recapturing of federal funds due to noncompliance with policies and procedures,” and projects funded by the Federal Emergency Management Agency are at a standstill because of inaction by VIHFA leadership.
After expressing concerns internally, Berry claimed that VIHFA Executive Director Eugene Jones Jr. cautioned that “if she kept putting things in writing, it would be to [her] detriment.” The suit also names Chief Disaster Recovery Officer Dayna Clendinen, who served as the authority’s interim executive director for much of Berry’s tenure.
Berry began working for VIHFA in January 2023 and had oversight of the authority’s planning and construction, rental properties and homeownership divisions. Many of Berry’s allegations pertain to the planning and construction division, which, according to the complaint, “had not facilitated the construction of new homes in over six years, despite having amassed about $14 million [sic] from the stamp tax legislation” when she came on board.
Berry further alleged that planning and construction staff participated in procurement evaluation committee panels, allowing them to write the specifications for work to be done — including pricing — and that they “were then allowed to participate in the evaluation of bids for the job and influence who was recommended to be awarded the job.”
“This created a potential conflict of interest in knowing what the bid numbers should be, being able to disclose those numbers to a contractor, and then being on the committee to help influence that the job would go to that contractor,” according to the complaint.
Berry claimed that she raised the subject with Clendinen multiple times, but the practice continued. According to the complaint, she “repeatedly saw bids coming in on projects that were virtually the same as the supposedly confidential specification numbers for landscaping,” and work was repeatedly awarded to the same contractor.
According to Berry, planning and construction staff also signed off on invoices allowing contractors and vendors to receive tax exemptions through the Affordable Housing Development Program — even when those staff members were not directly involved in the projects. Berry emailed a VIHFA attorney in October 2023, recommending that the practice “be eliminated as soon as possible.” Berry emailed that attorney a second time to express concerns with the authority’s practice of allowing construction managers to oversee projects that “they are too close to.”
“An example is a P&C Construction Manager, who drafts a CDBG-DR project application for the project to be done by VIHFA and responds to an inquiry on it, is involved in the preparation of the solicitation of a contractor, interacts with that contractor throughout that project, inspects the work, and submits payment requests,” according to the complaint. “That is too close a relationship to sign off on tax exemptions and should be done by others within the department with knowledge of the work.”
Berry also claimed that she repeatedly declined to sign off on documents sent by a contractor requesting a refund for costs. In late September, she told VIHFA Jones that she and Clendinen “were at an impasse as to establishing a policy that no employee, who is not assigned to a project, should be signing off on documents involving that project.”
“Almost immediately after that, Plaintiff’s work computer encountered technical difficulties,” according to the complaint. The following week, Jones called Berry into his office and terminated her employment, stating that she was not a “good fit” for the organization and that she didn’t get along with staff. Jones later appointed Clendinen to the dual role of COO and chief disaster recovery officer.
Berry’s complaint also shed light on an alleged scheme by former VIHFA subcontractors to reap millions in federal disaster recovery dollars while mismanaging construction materials meant for emergency home repairs. In June, a federal grand jury returned an indictment charging Davidson and Sasha Charlemagne with government program fraud, wire fraud and money laundering conspiracy. Former VIHFA COO Darin Richardson was charged with criminal conflict of interest and making materially false statements in connection with the alleged fraud.
According to federal prosecutors, VIHFA awarded a warehousing contract to Island Services Group, which subcontracted the work to the Charlemagnes’ company, D&S Trucking. Davidson Charlemagne then allegedly used his position as director of maintenance for the Education Department to store lumber rent-free at the vacant Alexander Henderson Elementary School on St. Croix.
A superseding indictment filed in October tacked on nine counts of making false claims against the United States and charged the Charlemagnes with repeatedly submitting inaccurate timesheets to VIHFA “knowing that said claims were false, fictitious and fraudulent.”
According to the whistleblower complaint, Berry became aware in June 2023 that a planning and construction manager was reviewing and approving D&S Trucking’s payment requests even though he had never been assigned the task. When questioned, the manager — who was not named as a defendant in the lawsuit — said Clendinen told him to do it.
The mismanaged lumber was earmarked for home repairs under the EnVIsion Tomorrow program, and Berry alleged widespread mishandling of the program, including overspending on administrative costs, projects being disqualified by the U.S. Housing and Urban Development Department for noncompliance with VIHFA procurement policy, and nonpayment to vendors.
“As of October 2024, when Plaintiff was terminated, she was aware that projects were being investigated for fraud,” according to the complaint.
In addition to claiming a violation of the Whistleblower Protection Act, Berry is claiming that Jones and Clendinen tortiously interfered with her employment at VIHFA, breach of contract and defamation.
VIHFA officials have not yet responded to written questions sent by The Source on Tuesday.
