Disaster Fraud

Authored By: Lagniappe Law Lab


Disaster Fraud

What is disaster fraud?

Disaster fraud is when there is an intentional deception to defraud individuals and the government. There are various types of disaster fraud. The issues discussed here include: 

  • Benefit Programs
  • Insurance and Home Repair 
  • Price Gouging 
  • Identity Theft
  • Charitable Solicitation

Unscrupulous consumer practices, i.e. disaster fraud affects all types of people after a disaster, even those who do not think a scam can take them. In addition, financial stress and disaster push many people into financial instability. Consumer information about fraud can help prevent you from being a victim. 

Report Disaster Fraud

The Department of Justice's National Center for Disaster Fraud (NCDF) allows you to submit complaints of fraud, waste, abuse, or mismanagement related to a natural disaster. 

Please use the NCDF Disaster Complaint Form to report: 

  • criminal conduct relating to natural and man-made disasters and other emergencies;
  • hoarding or price gouging of items
  • disaster fraud involves any Federal program providing financial assistance to individuals, businesses, or government entities (federal, state, or local)

Other conduct that you can report includes unemployment insurance fraud, unemployment insurance-related identity theft, hoarding/price gouging, health care fraud, identity theft, consumer fraud, phone call scams, text message scams, social media messaging scams, email scams, online scams, charity fraud, impersonation of a government official, contractor fraud, insurance fraud, DSNAP Fraud, FEMA Fraud, or corruption by state, local, or federal officials. 

You can also report disaster fraud and other consumer fraud to the Louisiana State Office of the Attorney General. The office does not handle disputes with utility companies, insurance claims, elected or public officials, state or municipal agencies, child support claims, or licensed professionals (doctors, dentists, attorneys). If the Attorney General's Office gets a dispute they cannot handle they will refer the issue to the correct agency. 

If you witnessed a potential scam or believe that you are a victim of a potential scam you can report it immediately to your local law enforcement authorities. If you suspect fraudulent activity involving FEMA, you can report it to the FEMA fraud investigations and inspections division. If you suspect identity theft, report and recover from identity theft at identitytheft.gov

Benefit Programs

About Fraud in Benefit Programs

Fraud is possible when someone wrongfully obtains public assistance or benefits offered through government programs that are meant to assist low-income, disabled, or elderly persons. Recipient fraud occurs when someone knowingly or intentionally provides false or misleading information or omits information regarding eligibility. It can also happen when the person fails to notify the agency of significant changes in their income or household that affects their eligibility. Recipient fraud can also occur when someone misuses public assistance funds or benefits. 

To learn more about check out the resources: 

Fraud reports of any kind may be filed confidentially with the USDA Office of Inspector General. You can also report fraud confidentially to the Louisiana State Department of Children and Family Services. Fraud can occur if you think someone has lied about their income or assets or is misusing their benefits. Fraud can occur if someone is illegally receiving public assistance benefits or illegally using an Electronic Benefit Transfer (EBT) card. 

The following are examples of some of the things that people conceal or do not report in order to receive ineligible SNAP benefits

  • Someone in the home beginning to work or quitting work 
  • Actual earnings or income of all household members 
  • Self-employment or doing odd jobs without reporting the income 
  • Ownership of property 
  • Money in the bank 
  • Unearned income such as social security, child support, unemployment compensation or veteran's benefits for any household members 
  • Everyone living in the home
  • Getting assistance in one parish while living in another parish or state 
  • Receiving assistance in more than one parish or state

To learn more about check out the resources: 

A disaster can trigger a few different kinds of "emergency snap benefits." DSNAP helps individuals when there is a federally declared disaster in which the President authorizes Individual Assistance for your parish. Current SNAP recipients are not eligible for DSNAP but may be eligible to get replacement or supplemental SNAP benefits. Recipients who are eligible can get help with benefits after a declared disaster. If you suspect someone is illegally getting DSNAP benefits you can report the fraud to the Department of Children and Family Services. 

To learn more check out the resources: 

Scam artists, identity thieves, and other criminals may take advantage of disaster survivors by taking advantage of FEMA assistance. Survivors should watch out and report suspicious activity related to FEMA and disaster fraud. If something doesn't feel correct, check with FEMA or local law enforcement to ensure your identity is protected. To report FEMA Fraud you can contact FEMA Fraud Investigations and Inspections Division

To learn more check out the resources: 

Disasters can cause loss of employment or self-employment. As a result, disaster unemployment assistance (DUA) is available as a direct result of the natural disaster. Unemployment insurance fraud tends to increase during a disaster event. Fraud can happen when someone gets payments from multiple states or if they misreport their actual earnings and get more benefits than they are entitled to. Report instances of unemployment insurance and workers compensation fraud in Louisiana. 

To learn more check out the resources: 

Disaster survivors may access SBA loans or SBA programs after a disaster to help rebuild or fix issues. If there is an issue with an SBA loan or SBA loan and you suspect fraud, waste, mismanagement, or misconduct, you can report the problem to the SBA

To learn more check out the resources: 

Insurance & Home Repair

Insurance & Home Repair Fraud and Scams

After a disaster, the chances of possible fraud or misrepresentation and chances of issues with payment plans or loans increase when working with contractors to repair damages. Disaster survivors might learn how to hire contractors, lookout for signs of fraud and misrepresentation, and ensure a contractor does the work they are hired to do. 

To learn more visit the resources: 

Honest contractors play an important role in assessing damages and providing estimates and information necessary to help you make your insurance claim. Disaster survivors can protect themselves from fraudulent home improvement contractors. Be wary of unsolicited contractors that show up after a disaster, offering to manage your insurance claim or promising insurance coverage for specific repairs or replacements. Licensed public adjusters are authorized by law to negotiate a claim with your insurers. 

To learn more check out the resources: 

After a disaster, disaster survivors may be using contractors to fix repair issues and other damages to property. Contractors can take advantage of disaster survivors by doing shoddy construction work or by not completing the work they are hired to do. Disaster survivors can learn how to create a good contract with contractors and learn how to hire and work with contractors to lessen the possibility of issues with contractors' work or repairs. 

To learn more visit the resources: 

Disaster survivors can get caught paying too much for repair and construction work after a disaster because of dishonest contractors or workers. To avoid issues with paying too much for repairs you can find out as much information as you can about the workers or the company. It is especially important to find out about the people who come without calling i.e. unsolicited. It is also important to check out people who come to the area from out-of-town after a natural disaster to take advantage of the disaster situation.

To learn more visit the resources: 

Home equity fraud is the taking of a homeowner's equity by fraudulent means. In a disaster, home equity fraud can be one way that an untrustworthy contractor may attempt to get homeowners to pay for the repair work done. While a home equity loan is a common way of getting funds for home repair, the money should not be paid out before the work gets started. 

To learn more check out the resources: 

Honest contractors play an important role in assessing damages and providing estimates and information necessary to help you make your insurance claim. Disaster survivors can protect themselves from fraudulent home improvement contractors. Be wary of unsolicited contractors that show up after a disaster, offering to manage your insurance claim or promising insurance coverage for specific repairs or replacements. Licensed public adjusters are authorized by law to negotiate a claim with your insurers. 

To learn more check out the resources: 

After a disaster, it is not uncommon for identity thieves to impersonate FEMA officials or insurance agents. This person may attempt to access your personal information including your social security numbers or other identifying information. Scammers who are successful can take this information and steal the money provided by the government, or homeowners insurance claim, for home repair or living expenses in the aftermath of a disaster.

Disaster survivors who get a phone call or contact from a FEMA representative or an insurance adjuster should only provide their claim number. They should already have access to any other information required to process the claim. Sometimes, the impersonator will tell someone that they can expedite the FEMA or insurance claim for a fee. This is a scam. FEMA does not offer a paid expedited claim service. 

Disaster survivors should always ask for verification from someone claiming to be from FEMA or an insurance adjuster. If a representative or adjuster comes to your house, then ensure that they have proper photo identification. 

Learn more by visiting the resources: 

The Home Repair Navigator Mobile App for Home Owners provides tools, insight, and access to resources that guide you throughout the entire Home Repair, Home Rebuilding, and Home Construction process.

Price Gouging

About Price Gouging

Price Gouging After a Disaster

Price gouging after a disaster is prohibited under Louisiana law

Charging excessive prices for necessities when an emergency has been declared by the governor or parish president can constitute price gouging. The prices charged or value received for goods or services sold within the emergency area may not exceed the prices ordinarily charged for comparable goods and services. Examples of such necessities include toilet paper, sanitizer, and personal protective equipment.

Price gouging occurs when retailers and others take advantage of spikes in demand due to events such as a disaster to charge high prices for necessities. Price gouging can increase the cost of construction and other contracting. This can create issues when estimates for repairs are calculated and may create issues with the difference between the payouts for insurance and other benefits and the actual cost of repairs. 

You can contact the Office of the Attorney General of Louisiana to report consumer disputes or other issues with fraud and price gouging. You can also report price gouging to the Department of Justice's National Center for Disaster Fraud (NCDF)

To learn more visit the resources: 

Identity Theft

About Identity Theft

Identity theft tends to increase after a natural disaster. Disaster survivors should be aware of anyone who is trying to steal personal information through fraud or identity theft after a disaster. To avoid identity theft, be very cautious before providing any personal or identifying information to anyone, especially anyone contacting you after a natural disaster. Protect your identity information online, on the phone, or in person. Identity theft can happen anywhere. After a disaster fraud can occur when documents are left behind, someone poses as a government official, someone pretends to represent a charity, or someone impersonates insurance agents, bank agents, or housing inspectors. Identify what you need to protect. Once an opportunist can get a hold of your identity documents or information they can take over financial accounts and engage in types of identity theft and scams. Do not throw away any identifying information in the trash and be sure to shred all information including credit card, loan offers, and other financial solicitations. 

To learn more check out the resources: 

After a disaster beware of imposters who may come to the door and say they are from FEMA. Scammers may also call to collect personal identifying information. FEMA officials are required to have identification and must provide an official government identity card. If you ask to see a person's information and you have a reason to believe it is fraudulent, then contact FEMA to verify if the person's identity is real. Disaster survivors who have already applied for benefits through FEMA or the SBA will get a registration number. During home inspections or phone calls with someone claiming to be a FEMA representative, always ask them to confirm your application number. Call the FEMA Helpline if they cannot provide you with the correct number. This is the best way to protect yourself from any scam. Keep your registration number safe and do not provide your number to anyone that asks. Verify if the person is a real government FEMA official. 

Government disaster officials will never call you to ask for your financial account information. Housing inspectors never charge a fee to inspect the property or provide assistance. Do not trust anyone who offers financial assistance and then asks for money or personal information. 

To learn more check out the resources: 

Charitable Solicitation

Fraudulent Charitable Solicitation

Fraudulent Charitable Solicitation After a Disaster

After a disaster, it is not uncommon for charitable solicitation to occur, which is fraudulent. Scammers who take part in this type of fraud may be sophisticated, playing into people's sympathy for those affected by the tragedy. If you are contacted by someone who is claiming to work for a charity, do your due diligence before you give or donate. If it's not a charitable organization you are familiar with, then you can look them up on a watchdog site like Charity Navigator or CharityWatch and check their entry at the Better Business Bureau.

Here are a few warning signs to watch out for if a charity contact you to ask for help: 

  • Aggressive pleas for donations 
  • Reluctance to provide a call-back number or offer contact information 
  • The promise of entry into a sweepstakes or raffle 
  • Requests for funds via wire transfer 
  • Requests for funds via mail to a P.O. box 
  • Demands for personal or banking information 
Last Review and Update: Sep 12, 2022
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