Days after federal officials admitted that fraudulent reports may have cheated thousands of residents out of insurance money after Hurricane Sandy, the Federal Emergency Management Agency announced the agency will review more than 144,000 insurance claims filed by superstorm victims.
More than 2,000 Hurricane Sandy victims are suing their insurance companies over fraudulent engineering reports but elected officials said residents’ refunds shouldn’t be dependent on whether they were in litigation, so the agency announced it would reopen and review every flood insurance claim filed by Sandy victims, even if they have not filed a lawsuit.
Residents had long suspected foul play with denied claims, but in early March an official with the disaster agency admitted in a “60 Minutes” interview that it discovered widespread fraud in the reports sent to insurance companies to decide residents’ payouts.
Agency employee Brad Kieserman said he has personally seen engineering reports that were changed. In many cases, reports that originally said homes were damaged from flooding were changed to say the destruction wasn’t related to water damage so victims didn’t receive full payouts from their insurance companies, which was the case with a Gerritsen Beach couple who is suing their insurance company.
Gerritsen Beach residents Vincent and Terri Ann Carrozza say their insurance company changed their engineering report to deny the damage of their home was from flooding, according to the couple’s attorney, Benjamin Pinczewski.
“We have been in contact with Attorney General Schneiderman on this issue, as he continues his criminal inquiry into this matter and we reiterate our call today for the appointment of a special monitor to review every questionable case,” Adams said.
Until there is outside oversight, Pinczewski’s law partner said he isn’t confident that a federal agency that has failed residents multiple times will bring the victims the justice they deserve.
“I’m skeptical,” said attorney Mitch Shpelfogel. “To allow FEMA to do yet a third bite of the apple, who is to say they’re going to do the right thing?”