FEMA Wants Over $300M in Katrina Aid Back

Martina Wiggins with her grandsons Joshua Porrazzo, 8, left, and Jarred Porrazzo, 7, talks to The Associated Press about FEMA fraud in Violet, La., Thursday, Oct. 26, 2006. In St. Bernard Parish, close to where Katrina made landfall south of New Orleans last August, the floodwaters rose above 20 feet, and white FEMA trailers are still parked outside almost every house. Residents there, like Wiggins told the same story: she said was denied aid because someone had already applied using her address. "They gave away the money too fast," Wiggins said bitterly. "A lot of people got money who didn't deserve it." (AP Photo/Alex Brandon) (Alex Brandon - AP)

Among those already prosecuted: Lakietha Diann Hall, 35, of Dallas. Prosecutors said Hall and 10 others _ including her mother _ filed fraudulent assistance applications over the Internet claiming damage to her home in New Orleans. Hall, whom authorities said never lived in Louisiana, received $65,000 in disaster aid, court records show.

The New Orleans apartment complex where Hall claimed she lived was in a neighborhood of 18,100 homes before the storm; FEMA records show the government gave money to more than 21,000 homes there after Katrina.

Hall pleaded guilty to identity theft. She was sentenced in November to 70 months in prison and ordered to pay $100 each month until she repays the U.S. government $83,254 _ a court-imposed payment plan that will take nearly 70 years. Her co-defendants were sentenced to anywhere from probation to one year in prison.

Prosecutors also charged Nakia Grimes of Atlanta, who collected $2,000 in emergency aid after she claimed her home near the Louisiana Superdome was damaged. Grimes listed her ZIP code as one reserved for P.O. boxes in that part of New Orleans _ and she was one of three such people who received a total of $6,358 in checks. Grimes' check was mailed the same day she filled out her Internet application, court records show.

Investigators said Grimes, 31, also never lived in New Orleans. In March 2006, she was convicted of mail fraud, sentenced to four months' home detention and ordered to pay a $100 fine.

Census figures showing the number of households within ZIP codes don't always correspond precisely with the post office ZIP codes where FEMA sent grant money. But the AP's findings are similar to those of a February report by the Government Accountability Office, which found hurricane aid was used for to pay for guns, strippers and tattoos. The GAO concluded that between $600 million and $1.4 billion was improperly spent on Katrina relief alone.

In one neighborhood GAO scrutinized, at least one person gave an address as a cemetery. Records show FEMA gave 27,924 assistance grants worth $293 million in that neighborhood. The AP's analysis shows only 18,590 homes existed, meaning up to $98 million in aid could have been disbursed improperly or illegally.

Other agencies have moved at a more cautious and deliberative pace awarding assistance money.

The Louisiana Road Home program has handed out fewer than 400 grants to help homeowners return _ even though it's received more than 100,000 applications and is under increasing pressure from the governor and anxious homeowners. The Small Business Administration also got off to a slow start, cutting its first check more than a month after Katrina made landfall, despite receiving more than 26,000 applications.

Some south Louisiana residents said fraud was endemic in the chaotic days after the storms. Rick Caravalho, a local man walking across the French Quarter's Jackson Square on a recent morning, described it as "phenomenal." Caravalho lives close to where Bush acknowledged disappointed storm victims during his visit in September 2005.

A government official, Caravalho laughed, recently "was at the front door asking where 2003 Chartres Street was."

"There is no 2003 Chartres Street," he said. "It's a vacant lot."