Barbour: 450 homeowner grant applications look ‘very suspicious’

Published 4:57 pm Friday, September 15, 2006

Gov. Haley Barbour says there could be about 450 fraudulent applications among the roughly 17,000 submitted for Hurricane Katrina homeowner recovery grants on the Mississippi Gulf Coast.

For example, some applications were submitted for property that doesn’t exist, the governor said Thursday during a news conference in Jackson.

“For some weeks, we have been told that there are about 450 very suspicious applications,” Barbour said. “And hopefully some of them could turn out to just be a mistake. But we’re going to ask that each one of them be run down, if there is attempted fraud, that it be prosecuted.”

Sign up for our daily email newsletter

Get the latest news sent to your inbox

Mike Lanford, a deputy state attorney general, said federal and state authorities are working together on the investigations, including officials from the Department of Housing and Urban Development, the FBI, the state auditor’s office and the state attorney general’s office.

Money for the homeowner grants came from the federal government, but the state’s job-creation agency — the Mississippi Development Authority — is overseeing how the money is distributed to homeowners.

MDA hired a private company to screen applications. The complex process includes checking property titles and insurance records and finding out whether a homeowner holds any loans from the Small Business Administration.

The grants are not supposed to cover damages already paid by insurance companies. Barbour said more than 200 insurance companies hold policies on homes along the coast, and when it comes to answering questions for the grant process, “a lot of them have been great; some of them have not.”

Thousands of south Mississippi residents are still living in government-issued mobile homes or travel trailers more than a year after Katrina, and many are grumbling that the homeowner grant process is taking too long.

The governor said months ago that he hoped to have grant checks in people’s hands by Aug. 29, the one-year anniversary of the storm.

Under Mississippi’s current program, grants of up to $150,000 are available to homeowners whose property flooded during Katrina despite being outside the federally designated flood zone. The state is still seeking HUD approval for programs to help people who lived inside the flood zone and for rental property.

Pressed for details on possible fraud, Barbour said Thursday that the 450 “suspicious” applications are not simply from people seeking grants despite living inside the flood zone at the time of Katrina. He said about 1,500 applications came from people whose homes were inside the flood zone, and those applications are being kept for consideration in one of the upcoming rounds of grants.

Barbour said if investigators uncover solid proof of fraud, he wants the U.S. attorney’s office to prosecute.

“We have an obligation to the taxpayers to be sure that we use the money responsibly, legally, in accordance with congressional intent, and that we prevent fraud and error. We take that very seriously,” Barbour said.

MDA officials told a legislative committee last week that fewer than 100 grant checks had been sent to homeowners. Barbour did not have current numbers on Thursday, but he said about 10,000 families have been notified that they’ve been approved for a grant. He said they’ve been told to set up appointments to handle the final paperwork before they can get their checks.

Barbour said he’s frustrated by the pace at which the grant applications have been handled.

“It’s too slow,” he said. “And if it’s frustrating to me, think about people that are living in travel trailers.”