49–006 

109TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 109–473 

EMERGENCY AND DISASTER ASSISTANCE FRAUD 

PENALTY ENHANCEMENT ACT OF 2005 

MAY 19, 2006.—Committed to the Committee of the Whole House on the State of 

the Union and ordered to be printed 

Mr. SENSENBRENNER, from the Committee on the Judiciary, 

submitted the following 

R E P O R T 

[To accompany H.R. 4356] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on the Judiciary, to whom was referred the bill 

(H.R. 4356) to amend title 18, United States Code, with respect to 

fraud in connection with major disaster or emergency funds, having 

considered the same, reports favorably thereon without amendment 

and recommends that the bill do pass. 

CONTENTS 

Page 

Purpose and Summary ............................................................................................ 1 

Background and Need for the Legislation ............................................................. 2 

Hearings ................................................................................................................... 3 

Committee Consideration ........................................................................................ 3 

Vote of the Committee ............................................................................................. 3 

Committee Oversight Findings ............................................................................... 3 

New Budget Authority and Tax Expenditures ...................................................... 3 

Congressional Budget Office Cost Estimate .......................................................... 3 

Performance Goals and Objectives ......................................................................... 4 

Constitutional Authority Statement ...................................................................... 5 

Section-by-Section Analysis and Discussion .......................................................... 5 

Agency Views ........................................................................................................... 7 

Changes in Existing Law Made by the Bill, as Reported ..................................... 9 

Markup Transcript .................................................................................................. 11 

PURPOSE AND SUMMARY

In response to concerns that the current provisions of title 18, 

United States Code do not adequately address or deter fraud in 

connection with emergency and disaster assistance, Chairman SenVerDate Aug 31 2005 01:52 May 20, 2006 Jkt 049006 PO 00000 Frm 00001 Fmt 6659 Sfmt 6601 E:\HR\OC\HR473.XXX HR473

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senbrenner introduced H.R. 4356, the ‘‘Emergency and Disaster Assistance Fraud Penalty Enhancement Act of 2005,’’ on November 

17, 2005. H.R. 4356 creates a new criminal penalty specifically targeted at fraud in connection with major disaster or emergency benefits, increases criminal penalties for engaging in mail or wire 

fraud during and in relation to a major disaster or emergency, and 

directs the United States Sentencing Commission to promulgate 

guidelines to provide for increased penalties for persons convicted 

of disaster or emergency benefit fraud. 

BACKGROUND AND NEED FOR THE LEGISLATION

Congress has appropriated approximately $62.3 billion in disaster assistance in the wake of Hurricanes Katrina, Rita and 

Wilma. As of March 8, 2006, the Federal Emergency Management 

Agency’s (FEMA) allocations for Katrina and Rita-related relief 

from the Disaster Assistance Fund totaled approximately $29.8 billion. Of this amount, $13.45 billion has been allocated to human 

services including: unemployment assistance; crisis counseling; 

housing assistance; and various other needs of the victims. The remainder, approximately $16.4 billion, has been allocated for infrastructure, mitigation, general operations and the administration of 

field operations. These costs include expenditures for relief worker 

salaries, travel and transportation, as well as contracts for facilities, equipment, utilities, and other required services. 

Almost immediately after FEMA began making disaster assistance available to victims of the hurricanes, reports of fraud, misuse 

and abuse began to surface. These reports included allegations that 

recipients of disaster assistance had misused funds to purchase 

luxury goods, that non-eligible persons had applied for and received 

benefits, and that criminals had established phony Katrina-related 

websites to exploit those who wished to contribute to legitimate disaster assistance efforts. 

In response to increased instances of fraud following the hurricanes, the Attorney General announced the formation of the Hurricane Katrina Fraud Task Force. The Task Force is comprised of 

representatives from the Departments of Justice, Homeland Security, and Treasury, the Federal Bureau of Investigation, Federal 

Trade Commission, Securities and Exchange Commission, other 

Federal partners, as well as representatives of State and local law 

enforcement. As of the beginning of February 2006, 23 United 

States Attorneys had charged 212 people with various hurricanefraud related crimes, including fraud, identity theft, theft of Federal funds and public corruption, and obtained 40 guilty pleas. 

Although many of the cases prosecuted by the Task Force involved false or fraudulent claims for a few thousand dollars in 

FEMA benefits, other more elaborate and costly schemes have surfaced. For instance, the United States Attorney for the Northern 

District of Texas charged a Red Cross volunteer and his sister with 

theft of over 100 Red Cross debit cards used to obtain over 

$230,000 in benefits from the charity intended for Katrina Victims. 

The defendants used proceeds from these debit cards to purchase 

vehicles, jewelry and clothing for themselves, family members and 

friends. In another case, a grand jury in the Southern District of 

Texas returned a 39-count indictment against the owner of a Galveston, Texas hotel charging him with filing fraudulent claims with 


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FEMA for over $232,000 in Short-Term Lodging reimbursements. 

According to the indictment, the fraudulent conduct included filing 

claims for payment for rooms in the name of hurricane evacuees 

who had never stayed at the hotel, rooms in the name of supposed 

evacuees when the rooms were occupied by paying guests with different names, and multiple rooms in the name of a single guest 

when the guest occupied fewer rooms than billed. 

Despite efforts by Federal, State and local law enforcement to 

prosecute emergency and disaster benefits schemes wherever and 

whenever they occur, it is clear that current criminal penalties are 

insufficient to deter disaster fraud. In February 2006 alone, the Department of Justice announced 15 indictments, three guilty pleas, 

and two convictions for Hurricane Katrina or Rita-related disaster 

fraud. In March 2006, the Department charged or indicted another 

14 individuals for Katrina-related fraud and obtained four guilty 

pleas. To strengthen efforts by the Department of Justice to conduct disaster fraud prosecutions, on November 17, 2005, Chairman 

Sensenbrenner introduced H.R. 4356, the ‘‘Emergency and Disaster 

Assistance Fraud Penalty Enhancement Act of 2005.’’ The Department of Justice announced its support for this legislation by letter 

to the Committee from Assistant Attorney General William E. 

Moschella, Jr. on Monday, February 27, 2006. 

HEARINGS

The Committee on the Judiciary held no hearings on H.R. 4356. 

COMMITTEE CONSIDERATION

On Thursday, March 2, 2006, the Committee on the Judiciary 

met in open session and ordered favorably reported the bill H.R. 

4356, by a voice vote, a quorum being present. 

VOTE OF THE COMMITTEE

In compliance with clause 3(b) of Rule XIII of the Rules of the 

House of Representatives, the Committee notes that there were no 

recorded votes during the Committee consideration of H.R. 4356. 

COMMITTEE OVERSIGHT FINDINGS

In compliance with clause 3(c)(1) of Rule XIII of the Rules of the 

House of Representatives, the Committee reports that the findings 

and recommendations of the Committee, based on oversight activities under clause 2(b)(1) of Rule X of the Rules of the House of Representatives, are incorporated in the descriptive portions of this report. 

NEW BUDGET AUTHORITY AND TAX EXPENDITURES

Clause 3(c)(2) of Rule XIII of the Rules of the House of Representatives is inapplicable because this legislation does not provide new budgetary authority or increased tax expenditures. 

CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

In compliance with clause 3(c)(3) of Rule XIII of the Rules of the 

House of Representatives, the Committee sets forth, with respect to 

the bill, H.R. 4356, the following estimate and comparison prepared 


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by the Director of the Congressional Budget Office under section 

402 of the Congressional Budget Act of 1974: 

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, March 14, 2006. 

Hon. F. JAMES SENSENBRENNER, Jr., Chairman, 

Committee on the Judiciary, 

House of Representatives, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 4356, the ‘‘Emergency 

and Disaster Assistance Fraud Penalty Enhancement Act of 2005.’’

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Mark Grabowicz, who 

can be reached at 226–2860. 

Sincerely, 

DONALD B. MARRON, 

ACTING DIRECTOR. 

Enclosure 

cc: Honorable John Conyers, Jr. 

Ranking Member 

H.R. 4356—Emergency and Disaster Assistance Fraud Penalty Enhancement Act of 2005. 

CBO estimates that implementing H.R. 4356 would have no significant cost to the federal government. Enacting the bill could affect direct spending and revenues, but CBO estimates that any 

such effects would not be significant. H.R. 4356 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would not affect the budgets of 

State, local, or tribal governments. 

H.R. 4356 would establish a new federal crime for the commission of certain fraudulent acts relating to benefits distributed after 

major disasters or emergencies. Because the bill would establish a 

new offense, the government would be able to pursue cases that it 

otherwise would not be able to prosecute. We expect that H.R. 4356 

would apply to a relatively small number of offenders, however, so 

any increase in costs for law enforcement, court proceedings, or 

prison operations would not be significant. Any such costs would be 

subject to the availability of appropriated funds. 

Because those prosecuted and convicted under H.R. 4356 could 

be subject to criminal fines, the federal government might collect 

additional fines if the legislation is enacted. Criminal fines are recorded as revenues, then deposited in the Crime Victims Fund and 

later spent. CBO expects that any additional revenues and direct 

spending would not be significant because of the small number of 

cases likely to be affected. 

The CBO staff contact for this estimate is Mark Grabowicz, who 

can be reached at 226–2860. This estimate was approved by Peter 

H. Fontaine, Deputy Assistant Director for Budget Analysis. 

PERFORMANCE GOALS AND OBJECTIVES

The Committee states that pursuant to clause 3(c)(4) of Rule XIII 

of the Rules of the House of Representatives, H.R. 4356 is intended 


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to further the goal of deterring instances of emergency and disaster 

assistance fraud by creating a new crime and increasing criminal 

penalties found in current law. 

CONSTITUTIONAL AUTHORITY STATEMENT

Pursuant to clause 3(d)(1) of Rule XIII of the Rules of the House 

of Representatives, the Committee finds the authority for this legislation in art. I, § 8 of the Constitution. 

SECTION-BY-SECTION ANALYSIS AND DISCUSSION

The following discussion describes the bill as reported by the 

Committee. 

Sec. 1. Short title. 

Section 1 provides that the short title of the bill is the ‘‘Emergency and Disaster Assistance Fraud Penalty Enhancement Act of 

2005.’’

Section 2. Fraud In Connection With Major Disaster Or Emergency 

Benefits. 

Section 2 creates a new 18 U.S.C. § 1039, which would provide 

for a new crime of fraud in connection with major disaster or emergency benefits. Section 1039 would prohibit fraud in any matter involving any benefit authorized, transported, transmitted, transferred, disbursed or paid in connection with a major disaster or 

emergency declaration, or in connection with any Federal Government contract related to such declarations, as long as the benefit 

was authorized or paid in interstate commerce, transported in the 

mail, or is a record, payment, money or other thing of value of the 

United States. Violations of this section would be punishable by 

fines up to $250,000 for an individual or $500,000 for an organization, imprisonment of up to 30 years, or both. 

Section 3. Increased Criminal Penalties For Engaging In Wire, 

Radio, And Television Fraud During And Relation To A Presidentially Declared Major Disaster Or Emergency. 

Section 3 increases the penalties available for wire fraud that 

occur in connection with major disaster or emergency declarations. 

Under current law, violations of the wire fraud statute (18 U.S.C. 

§ 1343) are punishable by fines up to $250,000 for an individual or 

$500,000 for an organization, or up to 20 years in prison, unless 

the violation involves a financial institution. In financial institutions cases, the maximum penalty is increased to 30 years. Section 

3 adds frauds occurring ‘‘in relation to, or involving any benefit authorized, transported, transmitted, transferred, disbursed or paid 

in connection with a presidentially declared major disaster or emergency’’ to the 30-year maximum now applicable only to financial institution fraud. 

Section 4. Increased Criminal Penalties For Engaging In Mail 

Fraud During And Relation To A Presidentially Declared 

Major Disaster or Emergency. 

Section 4 increases the penalties available for mail fraud that 

occur in connection with major disaster or emergency declarations. 


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Under current law, violations of the mail fraud statute (18 U.S.C. 

§ 1341) are punishable by fines up to $250,000 for an individual or 

$500,000 for an organization, or up to 20 years in prison, unless 

the violation involves a financial institution. In financial institutions cases, the maximum penalty is increased to 30 years. Section 

3 adds frauds occurring ‘‘in relation to, or involving any benefit authorized, transported, transmitted, transferred, disbursed or paid 

in connection with a presidentially declared major disaster or emergency’’ to the 30-year maximum penalty. 

Section 5. Directive To Sentencing Commission. 

Section 5 directs the United States Sentencing Commission to 

promulgate sentencing guidelines, or amend the existing guidelines 

to provide for increased penalties for fraud or theft offenses in connection emergency and major disaster declarations. Section 5 also 

directs the Commission to submit any guidelines changes to the 

Committees on the Judiciary, along with any additional policy recommendations the Commission may have for combating emergency 

or disaster fraud. 


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AGENCY VIEWS


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CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the 

House of Representatives, changes in existing law made by the bill, 

as reported, are shown as follows (new matter is printed in italics 

and existing law in which no change is proposed is shown in 

roman): 

TITLE 18, UNITED STATES CODE 

* * * * * * * 

PART I—CRIMES 

* * * * * * * 

CHAPTER 47—FRAUD AND FALSE STATEMENTS 

Sec. 

1001. Statements or entries generally. 

* * * * * * * 

1039. Fraud in connection with major disaster or emergency benefits. 

* * * * * * * 

§ 1039. Fraud in connection with major disaster or emergency 

benefits 

(a) Whoever, in a circumstance described in subsection (b) of 

this section, knowingly— (1) falsifies, conceals, or covers up by any trick, scheme, or 

device any material fact; or 

(2) makes any materially false, fictitious, or fraudulent 

statement or representation, or makes or uses any false writing 

or document knowing the same to contain any materially false, 

fictitious, or fraudulent statement or representation, 

in any matter involving any benefit authorized, transported, transmitted, transferred, disbursed, or paid in connection with a major 

disaster declaration under section 401 of the Disaster Relief Act of 

1974, or an emergency declaration under section 501 of the Disaster 

Relief Act of 1974, or in connection with any procurement of property or services related to any emergency or disaster declaration as 

a prime contractor with the United States or as a subcontractor or 

supplier on a contract in which there is a prime contract with the 

United States, shall be fined under this title, imprisoned for not 

more than 30 years, or both. 

(b) The circumstance to which subsection (a) of this section refers is that—

(1) the authorization, transportation, transmission, transfer, disbursement, or payment of the benefit is in or affects 

interstate or foreign commerce; 

(2) the benefit is transported in the mail at any point in the 

authorization, transportation, transmission, transfer, disbursement, or payment of that benefit; or 

(3) the benefit is a record, voucher, payment, money, or 

thing of value of the United States, or of any department or 

agency thereof. 


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(c) In this section, the term ‘‘benefit’’ means any record, voucher, 

payment, money or thing of value, good, service, right, or privilege 

provided by the United States, State or local government, or other 

entity. 

* * * * * * * 

CHAPTER 63—MAIL FRAUD 

* * * * * * * 

§ 1341. Frauds and swindles 

Whoever, having devised or intending to devise any scheme or 

artifice to defraud, or for obtaining money or property by means of 

false or fraudulent pretenses, representations, or promises, or to 

sell, dispose of, loan, exchange, alter, give away, distribute, supply, 

or furnish or procure for unlawful use any counterfeit or spurious 

coin, obligation, security, or other article, or anything represented 

to be or intimated or held out to be such counterfeit or spurious 

article, for the purpose of executing such scheme or artifice or attempting so to do, places in any post office or authorized depository 

for mail matter, any matter or thing whatever to be sent or delivered by the Postal Service, or deposits or causes to be deposited 

any matter or thing whatever to be sent or delivered by any private 

or commercial interstate carrier, or takes or receives therefrom, 

any such matter or thing, or knowingly causes to be delivered by 

mail or such carrier according to the direction thereon, or at the 

place at which it is directed to be delivered by the person to whom 

it is addressed, any such matter or thing, shall be fined under this 

title or imprisoned not more than 20 years, or both. If the violation 

occurs in relation to, or involving any benefit authorized, transported, transmitted, transferred, disbursed, or paid in connection 

with, a presidentially declared major disaster or emergency, or affects a financial institution, such person shall be fined not more 

than $1,000,000 or imprisoned not more than 30 years, or both. 

* * * * * * * 

§ 1343. Fraud by wire, radio, or television 

Whoever, having devised or intending to devise any scheme or 

artifice to defraud, or for obtaining money or property by means of 

false or fraudulent pretenses, representations, or promises, transmits or causes to be transmitted by means of wire, radio, or television communication in interstate or foreign commerce, any 

writings, signs, signals, pictures, or sounds for the purpose of executing such scheme or artifice, shall be fined under this title or imprisoned not more than 20 years, or both. If the violation occurs in 

relation to, or involving any benefit authorized, transported, transmitted, transferred, disbursed, or paid in connection with, a presidentially declared major disaster or emergency, or affects a financial institution, such person shall be fined not more than 

$1,000,000 or imprisoned not more than 30 years, or both. 

* * * * * * * 


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MARKUP TRANSCRIPT

BUSINESS MEETING 

THURSDAY, MARCH 2, 2006 

HOUSE OF REPRESENTATIVES, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Committee met, pursuant to notice, at 10:00 a.m., in Room 

2141, Rayburn House Office Building, the Honorable F. James Sensenbrenner, Jr. (Chairman of the Committee) presiding. 

[Intervening business.] 

Chairman SENSENBRENNER. Pursuant to notice, I now call up the 

bill H.R. 4356, the ‘‘Emergency and Disaster Assistance Fraud Penalty Enhancement Act of 2005,’’ for purposes of markup and move 

its favorable recommendation to the House. Without objection, the 

bill will be considered as read and open for amendment at any 

point. 

[The bill, H.R. 4356, follows:] 


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1

I

109TH CONGRESS

1ST SESSION H. R. 4356

To amend title 18, United States Code, with respect to fraud in connection

with major disaster or emergency funds.

IN THE HOUSE OF REPRESENTATIVES

NOVEMBER 17, 2005

Mr. SENSENBRENNER introduced the following bill; which was referred to the

Committee on the Judiciary

A BILL

To amend title 18, United States Code, with respect to

fraud in connection with major disaster or emergency funds.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE.

4 This Act may be cited as the ‘‘Emergency and Dis5 aster Assistance Fraud Penalty Enhancement Act of

6 2005’’.

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2

•HR 4356 IH

1 SEC. 2. FRAUD IN CONNECTION WITH MAJOR DISASTER OR

2 EMERGENCY BENEFITS.

3 (a) IN GENERAL.—Chapter 47 of title 18, United

4 States Code, is amended by adding at the end the fol5 lowing:

6 ‘‘§ 1039. Fraud in connection with major disaster or

7 emergency benefits

8 ‘‘(a) Whoever, in a circumstance described in sub9 section (b) of this section, knowingly—

10 ‘‘(1) falsifies, conceals, or covers up by any

11 trick, scheme, or device any material fact; or

12 ‘‘(2) makes any materially false, fictitious, or

13 fraudulent statement or representation, or makes or

14 uses any false writing or document knowing the

15 same to contain any materially false, fictitious, or

16 fraudulent statement or representation,

17 in any matter involving any benefit authorized, trans18 ported, transmitted, transferred, disbursed, or paid in con19 nection with a major disaster declaration under section

20 401 of the Disaster Relief Act of 1974, or an emergency

21 declaration under section 501 of the Disaster Relief Act

22 of 1974, or in connection with any procurement of prop23 erty or services related to any emergency or disaster dec24 laration as a prime contractor with the United States or

25 as a subcontractor or supplier on a contract in which there

26 is a prime contract with the United States, shall be fined

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3

•HR 4356 IH

1 under this title, imprisoned for not more than 30 years,

2 or both.

3 ‘‘(b) The circumstance to which subsection (a) of this

4 section refers is that—

5 ‘‘(1) the authorization, transportation, trans6 mission, transfer, disbursement, or payment of the

7 benefit is in or affects interstate or foreign com8 merce;

9 ‘‘(2) the benefit is transported in the mail at

10 any point in the authorization, transportation, trans11 mission, transfer, disbursement, or payment of that

12 benefit; or

13 ‘‘(3) the benefit is a record, voucher, payment,

14 money, or thing of value of the United States, or of

15 any department or agency thereof.

16 ‘‘(c) In this section, the term ‘benefit’ means any

17 record, voucher, payment, money or thing of value, good,

18 service, right, or privilege provided by the United States,

19 State or local government, or other entity.’’.

20 (b) CLERICAL AMENDMENT.—The table of sections

21 for chapter 47 of title 18, United States Code, is amended

22 by inserting at the end the following new item:

‘‘1039. Fraud in connection with major disaster or emergency benefits.’’.

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4

•HR 4356 IH

1 SEC. 3. INCREASED CRIMINAL PENALTIES FOR ENGAGING

2 IN WIRE, RADIO, AND TELEVISION FRAUD

3 DURING AND RELATION TO A PRESI4 DENTIALLY DECLARED MAJOR DISASTER OR

5 EMERGENCY.

6 Section 1343 of title 18, United States Code, is

7 amended by inserting: ‘‘occurs in relation to, or involving

8 any benefit authorized, transported, transmitted, trans9 ferred, disbursed, or paid in connection with, a presi10 dentially declared major disaster or emergency, or’’ after

11 ‘‘If the violation’’.

12 SEC. 4. INCREASED CRIMINAL PENALTIES FOR ENGAGING

13 IN MAIL FRAUD DURING AND RELATION TO A

14 PRESIDENTIALLY DECLARED MAJOR DIS15 ASTER OR EMERGENCY.

16 Section 1341 of title 18, United States Code, is

17 amended by inserting: ‘‘occurs in relation to, or involving

18 any benefit authorized, transported, transmitted, trans19 ferred, disbursed, or paid in connection with, a presi20 dentially declared major disaster or emergency, or’’ after

21 ‘‘If the violation’’.

22 SEC. 5. DIRECTIVE TO SENTENCING COMMISSION.

23 (a) IN GENERAL.—Pursuant to its authority under

24 section 994(p) of title 28, United States Code, and in ac25 cordance with this section, the United States Sentencing

26 Commission forthwith shall—

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•HR 4356 IH

1 (1) promulgate sentencing guidelines or amend

2 existing sentencing guidelines to provide for in3 creased penalties for persons convicted of fraud or

4 theft offenses in connection with a major disaster

5 declaration under section 5170 of title 42, United

6 States Code, or an emergency declaration under sec7 tion 5191 of title 42, United States Code; and

8 (2) submit to the Committees on the Judiciary

9 of the United States Congress an explanation of ac10 tions taken by the Commission pursuant to para11 graph (1) and any additional policy recommenda12 tions the Commission may have for combating of13 fenses described in that paragraph.

14 (b) REQUIREMENTS.—In carrying out this section,

15 the Sentencing Commission shall—

16 (1) ensure that the sentencing guidelines and

17 policy statements reflect the serious nature of the of18 fenses described in subsection (a) and the need for

19 aggressive and appropriate law enforcement action

20 to prevent such offenses;

21 (2) assure reasonable consistency with other

22 relevant directives and with other guidelines;

23 (3) account for any aggravating or mitigating

24 circumstances that might justify exceptions, includycherry on PROD1PC64 with REPORTS


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•HR 4356 IH

1 ing circumstances for which the sentencing guide2 lines currently provide sentencing enhancements;

3 (4) make any necessary conforming changes to

4 the sentencing guidelines; and

5 (5) assure that the guidelines adequately meet

6 the purposes of sentencing as set forth in section

7 3553(a)(2) of title 18, United States Code.

8 (c) EMERGENCY AUTHORITY AND DEADLINE FOR

9 COMMISSION ACTION.—The Commission shall promulgate

10 the guidelines or amendments provided for under this sec11 tion as soon as practicable, and in any event not later than

12 the 30 days after the date of the enactment of this Act,

13 in accordance with the procedures set forth in section

14 21(a) of the Sentencing Reform Act of 1987, as though

15 the authority under that Act had not expired.

Æ

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Chairman SENSENBRENNER. The Chair recognizes himself for 5 

minutes to make a brief statement. 

Following Hurricanes Katrina and Rita, there have been a number of recorded instances of fraud in an attempt to illegally get 

monies that had been appropriated for hurricane relief. In September of last year, the Attorney General established a Hurricane 

Fraud Task Force, and since its formation there have been 23 U.S. 

Attorneys who have charged 212 people with various criminal activities and obtained 40 guilty pleas or convictions. 

Despite these efforts, it’s clear that the current criminal penalties are insufficient to deter disaster fraud. Last month alone, the 

DOJ announced 15 new indictments, 3 guilty pleas, and 2 convictions for hurricane-related disaster fraud. The current law provides 

an insufficient deterrent against those who would attempt to make 

a quick buck and keep the profits out of the hands of the truly 

needy. 

What this bill does is it creates a specific new criminal penalty 

to prohibit fraud in connection with any emergency or disaster benefit, including Federal assistance or private charitable contributions. 

Second, the bill amends the Federal mail and wire fraud statutes 

to add emergency and disaster benefits fraud to the 30-year enhanced penalties for those statutes. 

Finally, the bill directs the Sentencing Commission to review existing penalties for disaster assistance fraud, to amend the Sentencing Guidelines as necessary, and report back to the two Judiciary Committees. 

I would note for the record that DOJ has sent a letter to the 

Committee dated February 27 expressing its strong support for the 

bill. I urge the Members to support it and recognize the gentleman 

from Michigan, Mr. Conyers. 

Mr. CONYERS. Well, Mr. Chairman, this is a bill that I think all 

of us really want to see moved as quickly as possible, favorably reported this morning, amending title 18 of the United States Code 

to further establish criminal penalties for fraud associated with 

natural disasters and other emergencies. 

Like most of you, I was appalled to learn of the rampant schemes 

to illegally benefit others for whom these benefits were not intended from Government funding intended for the victims, including reports of even fraudulently obtained $2,000 relief cards and 

contractors claiming payment for work in New Orleans and Gulfport that was never performed. Individuals should be held accountable for attempting to fleece disaster relief, which tens of thousands of victims face such immediate and critical needs, and still 

do. 

And so I support the legislation and urge my colleagues to do the 

same, and I return the—— Mr. SCOTT. Would the gentleman yield? 

Mr. CONYERS. Yes, I will yield to the gentleman from Virginia. 

Mr. SCOTT. Thank you, and I appreciate the gentleman yielding. 

Mr. Chairman, I think this is—I speak in support of the legislation. Taking advantage of this situation I think is particularly egregious because our agencies, charitable or governmental agencies, 

really in these situations have a choice: they can go through the 

normal auditing process, making—checking people out before they 


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get their benefits, or they can really relax their standards in order 

to quickly get the assistance when it is desperately needed. 

We had situations in my area where the agencies had a choice 

on food stamps. You can ask for all the validation and everything 

that’s necessary, or you can give the people the food stamps right 

then and there while they are hungry and make themselves vulnerable to fraud, which is the subject of this situation. 

I think it is particularly egregious for somebody to take advantage of the fact that we’re really trying to help people in an emergency and take advantage of that to scheme and defraud. And I 

think this enhanced punishment is certainly appropriate, and I 

thank the gentleman for yielding. 

Mr. CONYERS. Thank you, Mr. Scott. 

And I return my time, Mr. Chairman. 

Chairman SENSENBRENNER. Are there amendments? 

[No response.] 

Chairman SENSENBRENNER. Without objection, by the way, all 

Members may put opening statements in the record at this point. 

Are there amendments? If there are no amendments, a reporting 

quorum is present. The question occurs on the motion to report the 

bill H.R. 4356 favorably. All in favor, say aye? Opposed, no? 

The ayes appear to have it. The ayes have it. The motion to report favorably is agreed to. 

Without objection, the staff is directed to make any technical and 

conforming changes, and all Members will be given 2 days, as provided by the rules, in which to submit additional, dissenting, supplemental, or minority views. 

[Intervening business.] 

The business noticed on today’s schedule having been concluded, 

without objection, the Committee stands adjourned. 

[Whereupon, at 11:01 a.m., the Committee was adjourned.] 

Æ 


ycherry on PROD1PC64 with REPORTS