Wednesday, June 14, 2006

"FEMA gets hoodwinked": big surprise?

I would laugh if this weren't so much money coerced from unwitting taxpayers, a lot of whom probably won't even hear of this fraud.
FEMA Gets Hoodwinked
Investigation Finds Agency Paid Up To $1.4B In False Hurricane Claims

WASHINGTON, June 13, 2006

(CBS/AP) The government doled out as much as $1.4 billion in bogus assistance to victims of 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.

Agents from the Government Accountability Office, the investigative arm of Congress, went undercover to expose the ease of receiving disaster expense checks from the Federal Emergency Management Agency.

The GAO concluded that as much as 16 percent of the billions of dollars in FEMA help to individuals after the two hurricanes was unwarranted.

The findings are detailed in testimony, obtained by The Associated Press, that is to be delivered at a hearing Wednesday by the House Homeland Security subcommittee on investigations.

To dramatize the problem, GAO provided lawmakers with a copy of a $2,358 U.S. Treasury check for rental assistance that an undercover agent got using a bogus address. The money was paid even after FEMA learned from its inspector that the undercover applicant did not live at the address.

"This is an assault on the American taxpayer," said Rep. Michael McCaul, R-Texas, chairman of the subcommittee that will conduct the hearing. "Prosecutors from the federal level down should be looking at prosecuting these crimes and putting the criminals who committed them in jail for a long time."

FEMA spokesman Aaron Walker said Tuesday that the agency, already criticized for a poor response to Katrina, makes its highest priority during a disaster "to get help quickly to those in desperate need of our assistance."

"Even as we put victims first, we take very seriously our responsibility to be outstanding stewards of taxpayer dollars, and we are careful to make sure that funds are distributed appropriately," he said....
The list goes on. That FEMA allowed taxpayers to be defrauded is not new news at all. I predicted fraud last September 8th, only days after Katrina hit, and I was proven correct on the 26th.

As I've said many times before, bureaucrats measure the success of their programs by numbers served, regardless of efficiency. Contrast this with how Wal-Mart and other stores truly helped Katrina victims merely by pursuing profit. Who do you trust better to help people: businesses and private individuals, or government that has no incentive to spend wisely?

A couple of related posts: it's so easy to rebuild New Orleans when using other people's money, and 9/11 widows go on luxury shopping sprees.

But let's put this in perspective: Katrina fraud is just a drop in the bucket. My own state of New York spends $45 billion a year on Medicaid, and even "The New York Times published two articles last year that detailed how billions of dollars were potentially being squandered by the state's Medicaid program." Every dollar counts, but relatively few American taxpayers will likely hear of the Katrina waste, and even fewer will hear of major programs' yearly waste.

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