FEMA says Northern California fire victims among thousands snagged in suspected fraudulent claims

The FBI, with help from the Sonoma County District Attorney's Office, is examining an alarming number of claims for federal disaster assistance in the wake of this month's fires using North Bay residents' Social Security numbers and other personal information without their knowledge, federal and local officials said this week.

Federal Emergency Management Agency officials said an undisclosed number of duplicate claims have been discovered in the application process for local fire victims seeking aid after suffering a property loss. The claims qualify applicants for up to $34,000 in federal disaster grants.

Some of the cases could be simple mistakes resulting from multiple forms filed by the same person or for the same address, said FEMA spokesman Frank Mansell. But, the agency has “no doubt” that others have been fraudulent, Mansell said.

He could not elaborate on how many suspicious claims have been flagged by FEMA officials for federal investigators out of the North Bay.

But nationwide, FEMA is now reporting tens of thousands of cases involving duplicate claims submitted for disaster assistance, including applications filed in the wake of the North Bay wildfires and recent storms in Texas and Florida. Those cases include claims FEMA suspects are fraudulent, making use of stolen Social Security and identification numbers, Mansell said.

It's unclear how many North Bay fire victims have been affected, he said. In Sonoma County, the local assistance center in downtown Santa Rosa has served more than 7,100 people, not all of whom have applied for aid. Across the county, nearly 7,000 structures - most of them homes - were destroyed by wildfire this month.

Widespread breaches

The complete scope and precise origin of the potentially fraudulent registrations remain under investigation, but Mansell noted the country has recently seen “data breaches all over the place.”

The problems follow a string of high-profile data breaches, including at the credit bureau Equifax this year, where the personal information of more than 145 million Americans, including names, addresses and Social Security numbers, was potentially compromised.

Federal officials couldn't say whether that particular breach was directly connected to suspected disaster assistance fraud in California or elsewhere.

“I don't know what to tie it to. All I can say is that information is out there, and there are bad people taking advantage of the system,” Mansell said.

In the fire-stricken North Bay, the problems quickly caught the attention of authorities, including the FBI, which is investigating the matter in conjunction with local law enforcement agencies and the U.S. Attorney's Office.

“Fraud is an important mission of the FBI under normal circumstances, and it only becomes more of a priority for us when the people who are being defrauded are already beset by tragedy and disaster,” said Prentice Danner, a spokesman in the FBI's San Francisco office.

Filing a fraudulent disaster claim is punishable by up to 10 years in prison and $250,000 in fines, according to FEMA.

Common after disasters

Fraud is common after major disasters, given the number of people who are in need of assistance, Danner said. It's too soon to say who might be responsible in this instance, he said.

When applying for federal disaster aid online, over the phone or in person at an assistance center, victims are asked for their Social Security number, the address of their property, a description of damage, insurance information, phone number, an address where they can receive mail and a bank account and routing number.

Chip Banks, a Santa Rosa resident whose longtime Coffey Park home was destroyed by the Tubbs fire, chose to register for the assistance program in person last week.

He and his wife went to the local assistance center at The Press Democrat building in downtown Santa Rosa.

After assembling important paperwork, Banks, 58, tried to complete his registration online at the center. He wasn't able to finish.

“It just threw me out,” he said.

So Banks and his wife sat down with a FEMA agent, who also encountered difficulty while trying to register the couple. Eventually, the agent brought over a supervisor, who asked Banks for his Social Security number, address and phone number, which he provided.

The phone number didn't match - FEMA had one the couple used 10 years ago, Banks said. The center also had the wrong bank on file.

That's when the supervisor told Banks she was going to freeze his account and informed him he should be hearing from the FBI, he said.

“It was like getting hit across the face with a dead, wet fish,” Banks said. “It was dumbfounding.”

Banks said the supervisor told him his case resembled two others she encountered over just two hours. Since then, Banks has met several other fire victims who had the same problem, he said.

FEMA'S anti-fraud procedure

The situation in Sonoma County has been serious enough that FEMA instituted a new process for dealing with apparent fraud victims during their attempts to register for assistance. Rather than just freezing a duplicate registration after it is discovered, FEMA now makes sure applicants in such cases are positively identified and registered and then sends the duplicate form off to the inspector general's office at the Department of Homeland Security, Mansell said.

The change was instituted in recent days as FEMA officials began to grasp how many people were affected, according to Mansell.

“We didn't know how big the problem was, and we're still not sure how big the problem is,” he said. “We think it's enough that we had to look at the way we address this, because people don't need to experience a disaster followed by the fact that they find their personal data has been compromised by some sort of data breach, and then they have to jump through another hoop.”

Similar cases first arose in Texas during the aftermath of Hurricane Harvey. They have also been reported in Florida following Hurricane Irma, Mansell said.

Nationwide, he estimated tens of thousands of people have been impacted.

In California, the perpetrators haven't yet had much success in actually receiving financial assistance from FEMA, officials said.

“We're very confident in that,” Mansell said. “There's some critical pieces of information that are not there.”

Sonoma County District Attorney Jill Ravitch said she heard from Rep. Mike Thompson, D-St. Helena, shortly after Santa Rosa's local assistance center opened informing her of reports about fire victims being unable to sign up for FEMA assistance because someone else had done it in their place.

Since defrauding FEMA is a federal crime, Ravitch got in touch with the FBI, which began working to investigate the reports, she said. Ravitch's office will assist with the effort on a local level.

“We all jumped right on it,” Ravitch said. “It's terrible that someone would do that.”

Napa County, which was also hit hard by devastating wildfires this month, has seen similar fraud reports, too. In a statement released Wednesday, Napa County District Attorney Allison Haley said her office had received “several reports” from residents whose personal information, including Social Security numbers, was used without their permission to apply for FEMA assistance.

‘It's disgusting'

Robert Alman, who lost his home northeast of Santa Rosa to the Tubbs fire, said he encountered what suspected to have been a scam attempt during his aid registration last week.

Alman, 65, thought he was done after entering his wife's personal information - their property deed is in her name - but when he tried to get a login and password to check on the status of his registration, he saw a return email he didn't recognize. And he couldn't change it.

Alman thought it was simply a procedural hiccup after he called a FEMA help line and was told the agency would sort through the matter. Then he said he found out two of his neighbors had the same thing happen to them.

“It's disgusting,” he said.

He was able to register with a new account under his own name when he went to the local assistance center in person this week. He's still struggling to understand what would motivate someone to take advantage of disaster victims in such a way.

“To be honest, it's sort of like you fall in a river and you get out on the other side and it starts to rain: You're already soaked,” Alman said. “It's just like, are you kidding me?”

You can reach Staff Writer J.D. Morris at 707-521-5337 or jd.morris@pressdemocrat.com. On Twitter @thejdmorris.