The Federal Emergency Management Agency (FEMA) has asked hundreds of victims of 2012’s Superstorm Sandy to return nearly $6 million paid as compensation, and thousands more could be asked to do the same.
The Associated Press reports that as of early September, FEMA had asked around 850 aid recipients to return a collective $5.8 million. Approximately 3,600 other cases were still under review.
FEMA’s campaign to recover overpayments, called “recoupment” in agency lingo, typically involves inadvertent violations of eligibility rules, bureaucratic mistakes or missing documentation, rather than outright fraud.
Many people asked to return money were deemed ineligible because their damaged properties were vacation houses or rental properties, not their primary residences. Others had double dipped into the aid pool, with more than one household member getting payments. Some received FEMA money for things later covered by insurance.
As of July 30, the average demanded refund was $6,987, a sum that could be difficult for many, given the modest annual incomes of most aid applicants. Roughly half of the households under scrutiny reported an annual gross income of $30,000 or less.
The larger pool of cases still under review as of that date involved $53 million in aid payments — or about 3.7 percent of the total given out by FEMA through its individuals and households program — though any potential refunds would likely involve only a portion of that money.
“For most people, the money is long gone and long ago spent on storm recovery,” said Ann Dibble, director of the New York Legal Assistance Group’s storm response unit, which has been helping about a dozen families fight a FEMA clawback.
Twenty five cases under review involved households reporting a gross annual income of $500,000 or more.