Homeland Security Watch

News and analysis of critical issues in homeland security

December 7, 2006

GAO assesses Katrina waste and fraud

Filed under: Preparedness and Response — by Christian Beckner on December 7, 2006

The Government Accountability Office released a report on Wednesday entitled “Hurricane Katrina and Rita Disaster Relief: Continued Findings of Fraud, Waste and Abuse” as part of testimony before the Senate Homeland Security and Government Affairs Committee. The report chronicles dozens of examples of waste and abuse, as summarized in this AP story:

One year after Katrina, the government is still squandering tens of millions of dollars in wasted disaster aid, including $17 million in bogus rental payments to people who had already received free trailers and apartments, federal investigators said today.

At the same time, the Federal Emergency Management Agency has recovered less than 1 percent of the $1 billion it wasted on fraudulent hurricane assistance after the August 2005 storm, highlighting a need for stronger controls the next time a major hurricane strikes.

The report by the Government Accountability Office paints a picture of an agency still struggling – at substantial taxpayer expense – to find the balance between distributing quick aid to those in need while guarding against substantial abuse.

….Among the audit’s findings:

-Fraud detection is inadequate. Even though GAO found at least $1 billion in disaster aid waste, FEMA has identified about $290 million in improper payments and recouped just $7 million.

-Control procedures remain weak. FEMA was unable to locate dozens of laptops, printers and other items that federal employees purchased with government-issued credit cards for Katrina disaster work. In one case, FEMA purchased 20 flat-bottom boats, but could not find two of them and lacked titles to any of them.

It will be an uphill battle to recoup losses due to waste and fraud in this case, given the passage of time, but the federal government should continue to investigate this nonetheless, if only to deter similarly unacceptable behavior in the wake of future natural disasters.

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