More news on the FEMA front: the fraud, mismanagement and incompetence
are now alleged to equal $2 billion or. And it sure in the hell wasn't the evacuees running up the tab...
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June 27, 2006
'Breathtaking' Waste and Fraud in Hurricane Aid
By ERIC LIPTON
WASHINGTON, June 26 — Among the many superlatives associated with Hurricane Katrina can now be added this one: it produced one of the most extraordinary displays of scams, schemes and stupefying bureaucratic bungles in modern history, costing taxpayers up to $2 billion.
A hotel owner in Sugar Land, Tex., has been charged with submitting $232,000 in bills for phantom victims. And roughly 1,100 prison inmates across the Gulf Coast apparently collected more than $10 million in rental and disaster-relief assistance.
There are the bureaucrats who ordered nearly half a billion dollars worth of mobile homes that are still empty, and renovations for a shelter at a former Alabama Army base that cost about $416,000 per evacuee.
And there is the Illinois woman who tried to collect federal benefits by claiming she watched her two daughters drown in the rising New Orleans waters. In fact, prosecutors say, the children did not exist.
The tally of ignoble acts linked to Hurricane Katrina, pulled together by The New York Times from government audits, criminal prosecutions and Congressional investigations, could rise because the inquiries are under way. Even in Washington, a city accustomed to government bloat, the numbers are generating amazement.
\"The blatant fraud, the audacity of the schemes, the scale of the waste — it is just breathtaking,\" said Senator Susan Collins, Republican of Maine, and chairwoman of the Homeland Security and Governmental Affairs Committee.
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The waste ranged from excessive loads of ice to higher-than-necessary costs on the multibillion-dollar debris removal effort. Some examples are particularly stark.
The $7.9 million spent to renovate the former Fort McClellan Army base in Anniston, Ala., included fixing up a welcome center, clinic and gymnasium, scrubbing away mold and installing a protective fence between the site and a nearby firing range. But when the doors finally opened, only about 10 people showed up each night, leading FEMA to shut down the shelter within one month.
The mobile homes, costing $34,500 each, were supposed to provide temporary housing to hurricane victims. But after Louisiana officials balked at installing them inland, FEMA had no use for them. Nearly half, or about 10,000, of the $860 million worth of units now sit at an airfield in Arkansas, where FEMA is paying $250,000 a month to store them.
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The most disturbing cases, said David R. Dugas, the United States attorney in Louisiana, who is leading a storm antifraud task force for the Justice Department, are those involving government officials accused of orchestrating elaborate scams.
One Louisiana Department of Labor clerk, Wayne P. Lawless, has been charged with issuing about 80 fraudulent disaster unemployment benefit cards in exchange for bribes of up to $300 per application. Mr. Lawless, a state contract worker, announced to one man he helped apply for hurricane benefits that he wanted to \"get something out of it,\" the affidavit said. His lawyer did not respond to several messages left at his office and home for comment.
\"The American people are the most generous in the world in responding to a disaster,\" Mr. Dugas said. \"We won't tolerate people in a position of public trust taking advantage of the situation.\"
Two other men, Mitchell Kendrix of Memphis and Paul Nelson of Lisbon, Me., have pleaded guilty in connection with a scheme in Mississippi in which Mr. Kendrix, a representative for the Army Corps of Engineers, took $100 bribes in exchange for approving phantom loads of hurricane debris from Mr. Nelson.
In New Orleans, two FEMA officials, Andrew Rose and Loyd Holliman, both of Colorado, have pleaded guilty to taking $20,000 in bribes in exchange for inflating the count on the number of meals a contractor was serving disaster workers. And a councilman in St. Tammany Parish, La., Joseph Impastato, has also been charged with trying to extort $100,000 from a debris removal contractor. Mr. Impastato's lawyer, Karl J. Koch, said he was confident his client would be cleared.