A Dallas housing official who helped steer more than $800,000 in federal money to a friend is no longer working for the city, following an internal investigation that found he violated personnel rules.

The employee, Carl Wagner, had been on paid leave since March. That's when The Dallas Morning News reported on his longtime relationship with a homebuilder who had a spotty business record yet received city contracts to build homes for eight low-income families.

City officials disclosed his departure Thursday, but would not detail the findings of their investigation.

Wagner did not respond to requests for comment.

The homes were part of a city program to demolish dilapidated houses and replace them with new ones. Wagner helped his childhood friend, Fort Worth homebuilder and pastor Kenneth Williams, get contracts to build them.

The News found that Wagner and Williams had done business together since the late 1980s, and had worked together in Fort Worth. After a legal dispute with that city's housing department, Williams agreed to never again seek federal funds there.

When Williams applied to work for the city of Dallas in 2015, he misrepresented his financial history, falsely saying he had never filed for bankruptcy. Despite the red flags, Wagner helped Williams get the contracts.

“The city is supposed to verify everything included in the application,” said Dallas housing department director David Noguera. “That did not happen.”

The housing department was under different leadership when Williams received the contracts.

All eight homes Williams built were riddled with construction problems and built months behind schedule. Williams told The News earlier this year that he did the best he could within the city's budget.

The city is now hiring a structural engineer to evaluate the homes built by Williams, as well as by other contractors. Any problems will be addressed, Noguera said.

Following The News' investigation, federal officials issued an audit that found fault with the city's hiring of Williams. The audit also criticized how the city handled homes built by other businesses under the same program, and recommended that the city pay back $1.3 million. City Manager T.C. Broadnax has contested the repayment.