Auditing When Disaster Strikes

1
Auditing When Disaster Strikes
Matt Jadacki, Deputy Inspector General Disaster
Assistance OversightOffice of Inspector General
AGA Conference and ExpositionNashville, TNJune
27, 2007
2
Hurricane Katrina

• Resulted in over
• 1,326 Deaths
• 700,000 Displaced Persons
• 90,000 Square Miles of Damage

3
Initial Response

• August 29, 2005 - President declares major
  disaster.
• September 2nd - 7th - Congress approves over 60
  billion dollars in aid.
• September 2nd - Present FEMA obligates over 30
  billion for contracts, grants, and other disaster
  related activities.

4
Response Continued

• FEMA Provided Record Levels of Support to
  Victims, States, Emergency Responders
• However, FEMA Received Widespread Criticism for a
  Slow Ineffective Response
• Much of the Criticism was Warranted

5
IG Response Overview

• September 2005 - Inspector General Richard L.
  Skinner established the Office of Gulf Coast
  Hurricane Recovery to take the lead in
  coordinating disaster related activities
• October 2006 - IG Skinner established DAO to
  strengthen the OIGs ability to quickly and
  efficiently react to a variety of disasters as
  well as to take over, on a permanent basis, the
  work of the Office of Gulf Coast Hurricane
  Recovery.  

6
Federal Oversight

• DHS\OIG Office of Disaster Assistance Oversight
• PCIE\ECIE and Federal Inspectors General
• Hurricane Katrina Fraud Task Force
• Government Accountability Office (GAO)

7
(No Transcript)
8
Phases of Disaster

• Preparedness
• Response
• Recovery
• Mitigation

9
Case Study 1 Initially High Risk of Duplicate
Benefits

• Individual Assistance

10
Case Study 2 Debris Removal
11
Case Study 3 Manufactured Housing
12
The Auditors Role
Disasters need Real Time auditing.
13
Auditing in the Heat of Battle

• Can
• Stop Uncontrolled Spending
• Restore Sanity and Controls
• Curtail Expedited Contracts
• Ensure Laws and Regulations are followed

14
Pitfalls to Avoid

• The Spend First / Ask Questions Later Mentality
• Contracts with Few Terms Conditions
• Single Page / Million Dollar Contracts
• Lack of Cash Flow Management. Unlike the Federal
  Government, Cities Cant Spend Money They Dont
  Have
• Verbal Authorizations

15
Continuing Issues

• State and Local Coordination and Training
• Contracting
• Law Enforcement
• Data Sharing
• Reporting
• Funding and Staffing

16
Contact Information
Matt A. Jadacki, CPA, CGFM Deputy Inspector
General Disaster Assistance Oversight Office of
Inspector General U.S. Department of Homeland
Security Washington, DC 20528 202.254.4100Fax
202.254.4285