The Government Accountability Office (GAO) testified today at a House hearing and released testimony entitled “Hurricanes Katrina and Rita Disaster Relief: Improper and Potentially Fraudulent Individual Assistance Payments Estimated to Be Between $600 Million and $1.4 Billion.” From the report:
We estimate that 16 percent of payments, totaling approximately $1 billion, were improper and potentially fraudulent because of invalid registrations.6 This amount includes payments for expedited assistance, rental assistance, housing and personal property repair and replacement, and other necessary and emergency expenses. These payments were made to (1) registrations containing Social Security Numbers (SSNs) that were never issued or belonged to other individuals, (2) registrants who used bogus damaged addresses, (3) registrants who had never lived at the declared damaged addresses or did not live at the declared damaged address at the time of disaster, and/or (4) registrations containing information that was duplicative of other registrations already recorded in FEMAâ€™s system.
And from the AP story on the report:
The government doled out as much as $1.4 billion in fraudulent claims for relief after Hurricanes Katrina and Rita, getting hoodwinked to pay for season football tickets, a tropical vacation and even a divorce lawyer, congressional investigators have found.
Prison inmates, a supposed victim who used a New Orleans cemetery for a home address, and a person who spent 70 days at a Hawaiian hotel all were able to wrongly get taxpayer help, according to evidence that gives a new black eye to the nation’s disaster relief agency.
Federal investigators even informed Congress that one man apparently used FEMA assistance money for a sex change operation.
The people who bilked the taxpayers in response to these natural disasters are the lowest form of scum. This report highlights the need to have strong, well-planned disbursement controls put in place in advance of future natural disasters; otherwise, the rush to provide relief will inevitably attract con artists and other lower forms of life in future natural disasters.
Update (6/14): Here’s FEMA’s testimony in response to the report.