FBI uncovers post-Katrina fraud by public officials

(1/24/06 - JACKSON, MS) -- The FBI has uncovered fraud by public officials in the wake of Hurricane Katrina and has created a task force to investigate corruption as federal money pours into the Gulf Coast region, Mississippi's top agent said Monday.

"We are seeing public officials facilitating some of the fraud," John G. Raucci, agent in charge in Mississippi, said in an interview with The Associated Press. "It's not widespread, I will say that, but we have seen it and we have begun addressing it."

Raucci would not give details.

Sheila Thorne, an FBI agent in Louisiana, said the bureau has set up task forces in each of that state's three districts to deal with hurricane-related fraud. "As allegations come in, they will be investigated," Thorne said in a separate interview.

Thorne said agents are looking at all levels of fraud in Louisiana, including public corruption.

Federal money has been pumped at an unprecedented rate into the gulf states since Katrina struck on Aug. 29, and Louisiana and Mississippi are set to receive billions in aid.

"So if a person was predisposed & to commit an act of public corruption, this will be the time when he or she can dig their hand into the public trough," Raucci said.

Raucci said there is low-level fraud occurring, including some people misrepresenting their identities to receive federal aid, and more sophisticated scams as well.

He said there will be indictments in the fraud cases, but could not say when or how many.

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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