FBI, House Committee Investigating Disaster Relief Fraud

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Following an announcement last week by Douglas Leff – the special agent in charge of the FBI’s field office in San Juan, Puerto Rico – that he is investigating allegations of misuse of federal funds distributed as part of hurricane recovery efforts, members of the House Natural Resources Committee announced it was opening its own investigation into the matter.

In a letter sent by four Republican members of the Committee, the members reference allegations that “mayors of local municipalities, or people associated with their offices, are giving their political supporters special treatment, goods they’re not giving to other people who need them.”

A series of back-to-back hurricanes this year devastated Puerto Rico, with “35 percent of households without drinking water and 80 percent of the island without power,” according to Government Executive. Multiple agencies have taken pains to warn agencies, contractors, and citizens alike of opportunistic attempts to commit fraud, including efforts to solicit donations on behalf of spurious organizations.

Scott Amey, the Project on Government Oversight’s general counsel, noted that, “Already just between Harvey, Irma and Maria the federal government has awarded—just in contracts—over $1.6 billion. It’s not too early to start investigating fraud, waste and abuse when $1.6 billion of taxpayer dollars has gone out the door.” Adding that, “There’s a hope there’s a deterrent effect if there’s strong oversight and accountability from the outset.”

Following Hurricane Katrina, the Department of Justice filed charges in more than 1,300 cases relating to fraud and abuse during recovery efforts. The agency subsequently formed the National Center for Disaster Fraud.

In a memo sent to agencies by Mick Mulvaney, director of the Office of Management and Budget, federal employees were warned that, “In the aftermath of a disaster, there are also frequently cases of waste and abuse, such as instances where benefits provided to survivors and communities have little nexus to recovery efforts, or where agencies continue to expend resources well beyond the period where it is reasonable to assume that recovery activities are continuing.”



Posted in General News

Tags: FBI, fraud, disaster recovery, natural disasters