Report: FEMA misspent $7 million

June 24, 2009 3:56:45 PM PDT
Government investigators say the Federal Emergency Management Agency ignored the law and misused millions of dollars to build two warehouses after hurricanes Katrina and Rita. An inspector general report to be released Thursday says some of the money FEMA misused should have gone toward Katrina victims in Louisiana.

In the summer of 2006, FEMA spent more than $7 million on two warehouses the agency said it needed to repair trailers and mobile homes used by disaster victims. One of the warehouses was paid for out of the federal disaster relief fund, which investigators say is not permitted. And the other warehouse was paid for out of proceeds from sales of travel trailers and mobile homes -- also not allowed.

The report says senior FEMA leadership rejected the proposals for these warehouses, but they were built anyway.

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