Guarding Against Disaster Fraud 

Release Date: October 18, 2003
Release Number: 1490-59

» More Information on North Carolina Hurricane Isabel

Raleigh, NC -- Crime does not pay-especially after a disaster.

The North Carolina Division of Emergency Management Agency (NCDEM) and the Federal Emergency Management Agency (FEMA) today issued a warning that aggressive action will be taken against any criminal attempt to defraud the federal government in connection with victims of Hurricane Isabel.

"While we try to get help quickly to those who need it, we also work hard to make sure taxpayer dollars are not misused," said Dr. Kenneth B. Taylor, the officer managing the state disaster response for NCDEM.

Special agents from FEMA's Office of the Inspector General (OIG) use a number of methods to detect fraud. The OIG leads fraud task forces that can include several agencies, such as the U.S. Small Business Administration, the FBI and the U. S. Army. A key anti-fraud tool is FEMA's automated system, which crosschecks information with other agencies and insurance companies to weed out duplicate applications. In addition, field inspectors verify losses and damages for every person who applies to FEMA for individual assistance.

Potential cases of fraud or misuse are referred for investigation and prosecution as federal offenses. Persons convicted of claiming false losses can face a five- to 10-year prison term and up to $250,000 in fines.

People who made a mistake when reporting damage, or who may have misrepresented their losses, have the opportunity to correct or cancel their claim. Individuals may call the Helpline at 1-800-621-FEMA (3362), or TTY 1-800-462-7585 for the hearing- or speech-impaired, to withdraw or correct an application.

Anyone who knows of someone who has filed false damage claims or committed any other disaster-related fraud may report the incident to the Fraud Hotline at 1-800-323-8603. The line is open 24 hours a day, seven days a week, and caller identification will remain confidential.

The calls may be answered by a recorded message. Calls can be taken in both Spanish and English. The caller will be asked a few questions and the information will be assigned to a field investigator. If callers leave their name and phone number, the investigator will call them back.

Conducting audits and investigating possible fraud is standard procedure in all federal disaster operations. The U.S. Department of Justice prosecutes cases that result in criminal charges.

On March 1, 2003, FEMA became part of the U.S. Department of Homeland Security. FEMA's continuing mission within the new department is to lead the effort to prepare the nation for all hazards and effectively manage federal response and recovery efforts following any national incident. FEMA also initiates proactive mitigation activities, trains first responders, and manages Citizen Corps, the National Flood Insurance Program and the U.S. Fire Administration.

For more information about hurricane preparedness and recovery and specific information about Isabel, visit the FEMA website at www.fema.gov.

Last Modified: Monday, 20-Oct-2003 07:33:39