Hurricane Katrina: A Full Employment Act for Federal Fraud-Busters


More than 18 months after Hurricane Katrina decimated the Gulf Coast, authorities are chipping away at a mountain of fraud cases that, by some estimates, involve thousands of people who bilked the federal government and charities out of hundreds of millions of dollars intended to aid storm victims.

The full scope of Katrina fraud may never be known, but this much is clear: It stretches far beyond the Gulf Coast, like the hurricane evacuees themselves. So far, more than 600 people have been charged in federal cases in 22 states—from Florida to Oregon—and the District of Columbia.

The frauds range in value from a few thousand dollars to more than $700,000. Complaints are still pouring in and several thousand possible cases are in the pipeline—enough work to keep authorities busy for five to eight years, maybe more.

The AP reports that 150 to 250 new cases continue to be referred to investigators a week and that some 9,600 cases are being investigated. More here.

In a special section in our December 2005 issue, Reason looked at Katrina and the failure of public policy. And in our December 2006 issue, Neille Ilel looked at how unconventional groups plugged the gap left by traditional aid groups in New Orleans. Read all about it here.