Fraudsters splashed on diamonds, raunchy videos, sports tickets, US$200 champagne and ritzy resort stays as part of a billion-dollar bill in swindled payments meant for US hurricane victims.
A House of Representatives committee on Wednesday heard about a litany of bogus claims and misuses of emergency payments intended for victims of hurricanes Katrina and Rita last year.
In some eye-popping cases, prisoners who were jailed when the twin hurricanes barreled into the southern US coast billed the government for rental assistance.
And several supposed hurricane victims enjoyed months-long vacations at holiday hot spots in Hawaii and the Caribbean, content in the knowledge that Uncle Sam would pick up the tab.
Gregory Kutz, managing director of special investigations at the General Accounting Office, which audits US government spending, said US$1 billion -- or 16 percent of hurricane assistance payments -- were fraudulent.
"We believe our estimate understates the magnitude of the problem," he told shocked lawmakers.
Kutz said one individual stayed at a vacation resort in Orlando, Florida between September and November last year -- at a cost of US$12,000 to taxpayers, or US$249 a night. The fraudster was also given US$4,000 in emergency rental payments.
Another recipient relaxed in Hawaii for three months -- at a cost of US$115 per night -- even though that person lived in North Carolina, hundreds of kilometers north of the area devastated by the two hurricanes.
Kutz also said that some people abused special emergency debit cards that were given out to hurricane victims.
One person splurged on a US$200 bottle of Dom Perignon champagne at a Hooters restaurant, a chain famed for its scantily clad waitresses, he said.
Another scammer enjoyed a US$300 collection of Girls Gone Wild videos, which show risque shots of partying women, in various stages of undress and drunkenness.
In another scheme, a fan ordered five season tickets for the New Orleans Saints US football team, while another billed for disaster assistance and gave a bogus address -- which turned out to be occupied by a New Orleans cemetery.
Someone picked up US$400 worth of adult erotica products from a Houston, Texas business called "The Pleasure Zone," while another amassed a US$3,700 treasure trove of diamond jewelry, watches and earrings.
One love-lorn "victim" spent US$1,000 on a divorce lawyer.
"I am appalled at this. I want something done about this," said Michael McCaul, the chairman of the House of Representatives' Homeland Security Committee's sub-committee on investigations. "This has to stop. I don't even know where to start with all this."
Donna Dannels, acting deputy director of recovery at the much-lampooned Federal Emergency Management Agency, said many steps had been taken to close loopholes for this year's hurricane season.
Such eye-catching frauds represented only a small portion of the abuses of expedited assistance examined by the hearing, Dannels said.
She also argued that the situation was so chaotic after Hurricane Katrina -- which struck on Aug. 29, last year, inundating New Orleans -- that the agency was overwhelmed.
"We do have to put this in some sort of context," she said.
RSS