NYC Admits Defrauding FEMA After Sandy

City agrees to pay more than $5.3 million in a settlement.
February 26, 2019

New York City has reached a tentative deal to pay back the federal government more than $5.3 million in a settlement regarding allegations that the city submitted fraudulent claims to the Federal Emergency Management Agency after Hurricane Sandy. In the proposed settlement, the city admitted that it had filed false certifications to the federal government in order to receive relief funds for vehicles that the Department of Transportation (DOT) had claimed were damaged during the 2012 hurricane but had actually been out of use before Sandy.

“As a result of the joint review, NYC DOT has already instituted stronger procedures to reduce the risk of this ever happening again, including a new grants compliance officer and a centralized, comprehensive tracking system for the agency’s thousands of fleet vehicles,” said Scott Gastel, spokesperson for the city’s DOT.

U.S. Attorney for the Southern District of New York Geoffrey Berman said in a complaint with the proposed settlement, “When people lie to FEMA about the cause of property damage in order to reap a windfall, it compromises FEMA’s ability to provide financial assistance to legitimate disaster victims in desperate need.”

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