Etheridge Calls for Investigation of Waste, Fraud and Abuse of FEMA Contracts

News Release
Congressman Bob Etheridge
North Carolina

June 14 , 2006

Contact: Joanne Peters
Phone: (202) 225-4531

Etheridge Calls for Investigation of
Waste, Fraud and Abuse of FEMA Contracts

WASHINGTON - U.S. Rep. Bob Etheridge (D-Lillington), the Ranking Member of the Homeland Security Committee's Subcommittee on Investigations, today called for the committee to hold hearings on the wasteful contracting processes used by the Federal Emergency Management Agency during the Hurricane Katrina recovery.

Etheridge, the only N.C. member of the Homeland Security Committee, called for the hearings during a Subcommittee on Investigations hearing entitled "Waste, Fraud and Abuse in the Aftermath of Hurricane Katrina," which focused on fraudulent federal disaster assistance spending. Subcommittee Chairman Rep. Michael McCaul (R-TX) agreed to Etheridge's request.

"The Administration's irresponsible contracting processes and lax oversight have cost taxpayers billions of dollars. This waste is not isolated to the Hurricane Katrina recovery. Congress must exercise its oversight of FEMA so that the agency can reform its contracting processes," said Etheridge.

"This is not only about saving tax payers money, it's about ensuring that disaster recovery is not slowed by poor contracting processes. North Carolina needs to know that the federal government will be able to provide the support and resources to aid in the recovery following a hurricane."

A report issued by the House Government Reform Committee in May found that billions of dollars had been wasted on contracts for the Hurricane Katrina recovery. The report found that the main problems were no-bid contracts, layers of subcontracting that inflated costs and a lack of oversight on the completion of work.

Etheridge has introduced legislation to restructure and strengthen FEMA that would mandate better Department of Homeland Security oversight of administered federal benefits, and establish proper internal management controls to prevent and detect waste, fraud and abuse. It would establish a Deputy Inspector General of DHS to audit and investigate the use of federal funds in disaster recovery, including contracting fraud. H.R. 5351 passed the Homeland Security Committee on May 17.

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Pictured at top: Etheridge speaks to students about the importance of education