N.Y. Attorney General: Nation's Flood Insurance Program Defrauding Taxpayers The report comes after a joint investigation by NPR and PBS' Frontline that uncovered how private insurance companies in the aftermath of Superstorm Sandy were profiting while homeowners suffered.
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N.Y. Attorney General: Nation's Flood Insurance Program Defrauding Taxpayers

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N.Y. Attorney General: Nation's Flood Insurance Program Defrauding Taxpayers

N.Y. Attorney General: Nation's Flood Insurance Program Defrauding Taxpayers

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RENEE MONTAGNE, HOST:

NPR and Frontline recently brought you a story investigating insurance companies in the wake of Superstorm Sandy. We found that private insurance companies made millions off the nation's flood insurance program. And yesterday, the New York attorney general's office released a report finding that a lack of accountability in that flood program is very costly to taxpayers. It also brought charges of fraud. NPR's Laura Sullivan has more.

LAURA SULLIVAN, BYLINE: In the years after Sandy, tens of thousands of homeowners came forward saying the nation's flood insurance program shortchanged them, dragged them through years-long delays and hid information from them. The New York attorney general's office has now found that much of that is true. The report finds flood insurance does not cover what it promises in its ads, that many engineers and others hired to evaluate damage were not qualified and that homeowners were wrongly prevented from seeing copies of their own reports.

ROBERT MILLER: It most certainly is not transparent to the general consumer.

SULLIVAN: Robert Miller is an assistant attorney general who helped write the report. He and other investigators found FEMA, which runs the flood program, is not keeping track of fees it pays engineers and insurance companies to manage the policies. The report says, quote, "this lack of transparency and accountability can and does lead to inflated costs, defrauding the federal government of possibly millions."

MILLER: You know, every dollar matters. And these parties are fiscally responsible to the taxpayers.

SULLIVAN: The AG's office yesterday also announced 50 felony charges against an engineering firm for writing allegedly fraudulent reports. Homeowner Doug Quinn fought FEMA and his insurance company for years after the storm. He's still not home. He says he wants to see the program fixed before another group of storm victims has to go through the same process.

DOUG QUINN: Vindication is of small comfort at this point because the fact is is that this all should have been worked out years ago.

SULLIVAN: FEMA officials say they are adding oversight and transparency and plan to let homeowners have access to their reports. Laura Sullivan, NPR News, Washington.

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