Concerned that the Gulf Coast hurricanes are spawning an unprecedented number of bogus appeals to help victims, law enforcement officials and charities have launched aggressive efforts to prosecute fraud.
State and federal officials have filed charges in at lease four cases involving fraudulent appeals. They expect that number to rise sharply in the coming weeks as investigators examine thousands of suspicious fundraising Web sites, "phishing" schemes that steal financial information from donors and people falsely claiming to be raising money for hurricane funds.
"We're going to act quickly and aggressively to detect any kind of fraud and vigorously pursue it if we find it," said Alice Fisher, chairwoman of the Justice Department's Hurricane Katrina Fraud Task Force.
The task force includes the FBI, the Secret Service, the U.S. Postal Inspection Service, the Federal Trade Commission and the Department of Homeland Security. It is also working with state law enforcement officials and charities.
Last month, several Web sites set up by a self-proclaimed white separatist in St. Louis -- including donate-katrina.com and neworleanscharities.com -- were shut down after state officials found that none of the Web sites was registered as a charitable organization.
Similarly, sites with such names as katrinahelp.com and katrinadonations.com, set up in Florida, also have been closed down.
Law enforcement officials also are going after relief scams.
In California, two people posing as Red Cross volunteers outside a Best Buy store collected $2,000 before police stepped in when they couldn't prove that they worked for the charity. They have been charged with impersonating Red Cross volunteers. Federal law bars anyone from impersonating a Red Cross worker, and a conviction could lead to five years in prison.
The Red Cross also is taking an aggressive stance. It has sent out 50 "cease and desist" letters to operators of Web sites claiming to be raising money for the Red Cross. It is conducting 261 other fraud investigations in connection with Katrina, said spokeswoman Devorah Goldberg.
It expects to either turn those cases over to prosecutors or file civil suits, she said.
"The bottom line is we take fraud seriously, and the Red Cross will prosecute," Goldberg said.
The Internal Revenue Service also is keeping a close eye on the spate of organizations that have applied for nonprofit status to raise money for Katrina-related causes, officials said yesterday.
The agency is expediting approval of hurricane charities, as it did in 2001 for nonprofit groups set up to help victims of the Sept. 11 attacks.
So far, 135 Katrina-related organizations have applied for the expedited review, which can shorten the time needed to get approval for tax-exempt 501(c)(3) status from several months to a week, said IRS spokeswoman Nancy Mathis. Of those organizations, 30 have been approved, she said.
IRS Commissioner Marc W. Everson said that the agency plans to monitor the new organizations closely and that donors should be careful when deciding whether to donate to newly formed groups.
"We urge people to be prudent," Everson said. "Do a little bit of due diligence."