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 That happened to be the 16th anniversary of Hurricane Katrina
hitting New Orleans, killing more than 1,800 people during its existence. In
addition, the hurricane was estimated to have caused more than $160 billion in
damage.
Quickly, the fraud began.
The FBI announced in October 2008 that the Hurricane Katrina Fraud Task Force
brought federal charges against 907 people across the country for committing a
“wide range of crimes including emergency-benefit fraud, identity theft,
procurement fraud and public corruption.”
Less than a year after the hurricane, the New York Times called
the waste and fraud “breathtaking,” estimating that “one of the most
extraordinary displays of scams, schemes and stupefying bureaucratic bungles”
cost taxpayers up to $2 billion.
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The fraud was rampant. The Times gave examples: a
hotel owner in Sugar Land, Tex., charged with submitting $232,000 in
bills for phantom victims and about 1,100 inmates across the Gulf
Coast collecting more than $10 million in rental and disaster-relief
assistance.
The bureaucratic bungling was also bad, including
officials ordering almost half a billion dollars’ worth of mobile
homes that were never used, and spending about $416,000 per evacuee
on renovations for a shelter at a former Alabama Army base.
An investigation by the Washington Examiner 10 years after Katrina
found that it was impossible to know just how much money had been
lost to waste and fraud.
The government’s response to both Katrina and COVID-19 shows us that
emergencies and disasters attract bad actors and they cost taxpayers
billions of dollars.
The #WasteOfTheDay is presented by the forensic
auditors at OpenTheBooks.com. |
