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Friday, March 29, 2024

Five Charged in Fraud Schemes Linked to Hurricane Harvey

Six Houston-area residents have been charged with varying offenses related to disaster assistance in their alleged efforts to defraud the Federal Emergency Management Agency (FEMA) and Small Business Administration (SBA).

U.S. Attorney Ryan K. Patrick made the announcement just after the Gulf Coast region marked the one-year anniversary of Hurricane Harvey, the costliest storm in United States history.

“These types of cases are no different than looting during and after a storm,” said Patrick. “Some people try to exploit natural disasters by taking things that aren’t theirs. It is white-collar storm looting, and fewer people who actually need assistance get it.”

On Sept. 1, HSToday reported on the Justice Department’s warning to the public to be aware of fraud in times of disaster.

Five of the Houston-area residents are charged in separate indictments linked to Hurricane Harvey with a sixth stemming from the Memorial Day weekend flood in 2015.

The first indictment charges Clinton Booker, 51, of Houston with engaging in a scheme to defraud the SBA when he applied for and received a disaster loan from the administration. He allegedly claimed property damage from Hurricane Harvey in August 2017, but his residence had not sustained damage as claimed. According to the indictment, Booker submitted or caused others to submit falsified records to make the claim appear legitimate. Booker received $25,000 from the fraudulent SBA loan. He is charged with one count of fraud in connection with a major disaster and one count of wire fraud for which he faces up to 30 and 20 years in federal prison, respectively.

In a separate but similar case, Randal Radack, 44, of Spring allegedly engaged in a scheme to defraud the SBA and FEMA when he applied for and received disbursements, claiming property damage from Hurricane Harvey. However, he actually he did not reside at the property during Hurricane Harvey as claimed, according to the allegations. Radack allegedly received $115,100 from the fraudulent SBA loan and $16,541.38 in fraudulent disbursements from FEMA. Radack is charged with two counts of fraud in connection with a major disaster and five counts of wire fraud for which he faces up to 30 and 20 years in federal prison, on each count, respectively.

According to additional allegations, Humble resident Robert Kaitho, 55, also engaged in a scheme to defraud the SBA. He applied for and received a disaster loan from the SBA, claiming property damage from Hurricane Harvey when his residence had not sustained damage as claimed. According to the indictment, Kaitho used some of the proceeds from the fraudulent SBA loan to pay a credit card company. Kaitho received $53,000 from the fraudulent SBA loan, according to the charges. He is charged with one count of fraud in connection with a major disaster, two counts of wire fraud and two counts of money laundering. If convicted of the disaster fraud, he faces up to 30 years in prison, while wire fraud and money laundering carry a punishment of up to 20 and 10 years in federal prison, respectively.

Christopher Howard, 45, of Highlands Ranch, Colo., did not even reside at his Crosby property at the time of Hurricane Harvey. Nevertheless, he allegedly applied for and received FEMA disbursements, claiming property damage. Howard received $30,586.45 in fraudulent disbursements from FEMA as a result of the claim, according to the allegations. He is charged with one count of fraud in connection with a major disaster and four counts of wire fraud for which he faces up to 30 and 20 years in federal prison, respectively.

Patricia Rodriguez, 38, of Houston also allegedly engaged in a scheme to defraud when she applied for and received FEMA disbursements, claiming property damage from Hurricane Harvey. She was not even the owner of the property as claimed, according to the indictment. However, Rodriguez allegedly received $33,300 in fraudulent FEMA disbursements. She also faces a maximum of 30 and 20 years in federal prison, respectively, upon conviction of one count each of fraud in connection with a major disaster and wire fraud.

The final indictment alleges David Boniface claimed property damage from the Memorial Day flood in 2015, when his residence had not sustained damage as he had reported. Boniface, 60, of League City applied for and received a disaster loan from the SBA totalling $64,200. He submitted or caused others to submit falsified records to make the claim appear legitimate. Boniface is charged with one count of fraud in connection with a major disaster and two counts of wire fraud, which carry 30- and 20-year-maximum federal prison terms, respectively.

“Fraud cases take time to investigate,” Patrick explained. “One year after the storm my office is actively engaged with DHS and other agencies in similar investigations. This is just the first of what will probably be many cases related to Hurricane Harvey.”

All six people charged today are expected to make their initial appearances before a U.S. magistrate in the near future.

The SBA-Office of Inspector General (OIG) and the Department of Homeland Security OIG conducted the investigations. Assistant U.S. Attorney Michael Day is prosecuting the cases.

Five Charged in Fraud Schemes Linked to Hurricane Harvey Homeland Security Today
Kylie Bielby
Kylie Bielby has more than 20 years' experience in reporting and editing a wide range of security topics, covering geopolitical and policy analysis to international and country-specific trends and events. Before joining GTSC's Homeland Security Today staff, she was an editor and contributor for Jane's, and a columnist and managing editor for security and counter-terror publications.
Kylie Bielby
Kylie Bielby
Kylie Bielby has more than 20 years' experience in reporting and editing a wide range of security topics, covering geopolitical and policy analysis to international and country-specific trends and events. Before joining GTSC's Homeland Security Today staff, she was an editor and contributor for Jane's, and a columnist and managing editor for security and counter-terror publications.

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