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Government at Work
Phrobis
interdictor
KATRINA FRAUD AND WASTE ESTIMATED AT $2 BILLION

Corruption:


  • One Louisiana Department of Labor clerk, Wayne P. Lawless, has been charged with issuing about 80 fraudulent disaster unemployment benefit cards in exchange for bribes of up to $300 per application. Mr. Lawless, a state contract worker, announced to one man he helped apply for hurricane benefits that he wanted to "get something out of it," the affidavit said. His lawyer did not respond to several messages left at his office and home for comment.


  • Two other men, Mitchell Kendrix of Memphis and Paul Nelson of Lisbon, Me., have pleaded guilty in connection with a scheme in Mississippi in which Mr. Kendrix, a representative for the Army Corps of Engineers, took $100 bribes in exchange for approving phantom loads of hurricane debris from Mr. Nelson.


  • In New Orleans, two FEMA officials, Andrew Rose and Loyd Holliman, both of Colorado, have pleaded guilty to taking $20,000 in bribes in exchange for inflating the count on the number of meals a contractor was serving disaster workers. And a councilman in St. Tammany Parish, La., Joseph Impastato, has also been charged with trying to extort $100,000 from a debris removal contractor. Mr. Impastato's lawyer, Karl J. Koch, said he was confident his client would be cleared.


  • A program set up by the American Red Cross and financed by FEMA that provided free hotel rooms to Hurricane Katrina victims also resulted in extraordinary abuse and waste, investigators have found.

    First, because the Red Cross did not keep track of the hundreds of thousands of recipients — they were only required to provide a ZIP code from the hurricane zone to check in — FEMA frequently sent rental assistance checks to people getting free hotel rooms, the G.A.O. found.

    In turn, some hotel managers or owners, like Daniel Yeh, of Sugar Land, exploited the lack of oversight, investigators have charged, and submitted bills for empty rooms or those occupied by paying guests or employees. Mr. Yeh submitted $232,000 in false claims, his arrest affidavit said. His lawyer, Robert Bennett, said that Mr. Yeh was mentally incompetent and that the charges should be dismissed.



It's bad enough when private citizens defraud each other. It's worse when the bureaucrats who leech off the private citizens and are in positions of authority over them aren't content with the daily fraud and theft they commit against the masses, but take full advantage of catastrophes to enrich themselves further at the expense of those whose can least afford to be defrauded.

Too much government.