FLOOD OF FRAUD
April 4, 2007
More than 18 months after Hurricane Katrina decimated the Gulf Coast, authorities are chipping away at a mountain of fraud cases that, by some estimates, involve thousands of people who bilked the federal government and charities out of hundreds of millions of dollars intended to aid storm victims.
The full scope of Katrina fraud may never be known, but this much is clear: It stretches far beyond the Gulf Coast, like the hurricane evacuees themselves.
- So far, more than 600 people have been charged in federal cases in 22 states -- from Florida to Oregon -- and the District of Columbia.
- The frauds range in value from a few thousand dollars to more than $700,000. Complaints are still pouring in and several thousand possible cases are in the pipeline -- enough work to keep authorities busy for five to eight years, maybe more.
"The reason we're seeing such widespread fraud is individuals were evacuated to all 50 states. Katrina was a national phenomenon," said David Dugas, U.S. attorney in Baton Rouge, La., and director of a command center that's part of a special Hurricane Katrina Fraud Task Force. "Everybody knew what was going on. Therefore, criminals knew what was going on."
- The Government Accountability Office has referred more than 22,000 potential cases of fraud to the Katrina task force, though officials say the majority probably will not pan out.
- In a recent audit, the GAO also concluded FEMA had recovered less than 1 percent of some $1 billion investigators claim was fraudulent aid.
Source: Sharon Cohen, "Flood of fraud; More than 600 people accused in Katrina cons," Associated Press/Redding Record-Searchlight, April 2, 2007.
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