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Emergency and Disaster Assistance Fraud Penalty Enhancement Act of 2007

Location: Washington, DC



Mr. CHABOT. Madam Speaker, I yield myself such time as I may consume.

I rise in strong support of S. 863, the Emergency and Disaster Assistance Fraud Penalty Enhancement Act of 2007, and I want to thank and commend the gentleman from Michigan (Mr. Conyers) for his leadership on this bill as well.

In January of this year, I introduced a companion bill, H.R. 846, that would create a new criminal offense and enhance current Federal penalties for fraud associated with major disasters and emergency benefits.

Madam Speaker, August 29, 2005 was a day that this country will never forget. The images of destroyed homes, neighborhoods, communities, displaced families and friends, and lives literally torn apart by Hurricane Katrina especially will not easily fade from our memories.

The devastation in the gulf coast region reminds us of a tragedy that we would expect to see in Third World countries, not in our country, and particularly not in regions known for their history and their character.

Since Hurricanes Katrina, Rita, and Wilma devastated the gulf coast more than 2 years ago, Congress has provided more than $117 billion in relief to the region, including reconstruction efforts, medical services, human services, including funds for unemployment and housing assistance, crisis counseling, and various other needs of the victims. In addition, charities like the Red Cross and Salvation Army have contributed several billion dollars more to the effort, and many, many volunteers contributed their time.

[Time: 13:00]

To no one's surprise, almost immediately after FEMA and private charities began administering funds to victims, reports of fraud began to surface, such as noneligible persons filing false claims for benefits, and the creation of phony Katrina-related Web sites designed to exploit those who wished to make legitimate disaster relief contributions.

More elaborate and organized schemes have also come to light, including a group in Bakersfield, California, which conspired with employees of a Red Cross call center to defraud the charity by obtaining false claims information in order to collect assistance payments through Western Union. These scams don't just affect disaster victims, but the charities, donors and taxpayers who provide this assistance.

Federal law enforcement officials, including the Department of Justice, responded to the problem. In September 2005, the Hurricane Katrina Fraud Task Force was formed to mobilize the resources of the Federal Government, including Department of Justice, Homeland Security, Treasury, the FBI, FDC

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and other Federal partners, as well as representatives of State and local law enforcement.

Since its formation in 2005, the task force has assisted 41 United States Attorneys to prosecute more than 768 people to date. In addition, the Task Force Joint Command Center in Baton Rouge, Louisiana, continues to receive more than 700 calls each month through its nationwide hotline and has screened and referred more than 14,000 leads to law enforcement agencies and field offices across the country.

Yet, despite these efforts, it is clear that current criminal penalties are insufficient to deter disaster fraud. For example, in the U.S. Attorneys Office for the Middle District of Louisiana alone, 128 individuals have been charged with hurricane-related fraud.

S. 863 would strengthen Federal law enforcement's ability to combat and deter those who would otherwise attempt to exploit another's tragedy, preventing assistance from going to those who truly need it. How? Well, first this legislation creates a new specific criminal penalty to prohibit fraud in connection with any emergency or disaster benefit, including Federal assistance or private charitable contributions, as long as the benefit was authorized or paid in interstate commerce, transported through the mails, or is something of value. The penalty for engaging in such fraud is a fine or imprisonment of up to 30 years.

Second, the bill amends the Federal mail and wire fraud statutes to add emergency or disaster benefits fraud to the 30-year enhanced penalties in those statutes. Currently, the 30-year enhancement is reserved only for financial institutions fraud.

Finally, the bill directs the United States Sentencing Commission to review existing penalties for disaster assistance fraud, amend the sentencing guidelines as necessary, and report back to the Judiciary Committee of both the House and the Senate.

The Emergency and Disaster Assistance Fraud Penalty Enhancement Act unanimously passed the House back in the 109th Congress. Tough penalties for criminals who prey on innocent disaster victims are long overdue. I urge my colleagues to support S. 863.

I once again thank the gentleman from Michigan (Mr. Conyers) for his leadership on this issue.


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