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Sunday, December 14, 2008

Corruption in Katrina Cleanup

As the Blagojevich scandal continues to play out in Chicago, we should not forget that other city of corruption: New Orleans.

A couple of videos on a home repair corruption scandal that has been going on in New Orleans for months. Double billing, non existent homes being repaired, not doing the work claimed and even claiming to paint a brick house and billing the city over $6,000:






From an October 17, 2008 article by Gordon Russell in the New Orleans Times-Picayune


At least six city home-remediation contractors whose work was questioned by City Hall have failed to document their work or refund the city's money, despite two rounds of demand letters from the city.

So far, just one NOAH contractor has admitted a mistake and sent the city a check. The reimbursement, from contractor Training Connection Inc., totals $2,520 -- a small fraction of the overall sum in dispute from the contractors, which appears to be more than $100,000 but is something of a moving target.

The city's efforts to verify remediation work came after a series of television and newspaper reports presented evidence that some of the properties the city paid to gut or board up were never cleaned up. In response, the city quickly shuttered the agency and laid off its employees.

U.S. Attorney Jim Letten and New Orleans Inspector General Robert Cerasoli also announced investigations into the matter. And Mayor Ray Nagin, whose brother-in-law was among the contractors whose work was flagged, promised an aggressive city response.

He vowed "to treat every contractor the same, " and said: "If they owe us money, we're going to recover it."

The Nagin administration announced after its August review that it was demanding that contractors provide documentation to support $103,517 in payments the city made for work at 46 properties where officials later found no evidence of completed work. A snapshot Times-Picayune survey of properties in the program found that the city's review missed other questionable cases.

It's unclear how city officials decided which contractors had offered sufficient proof of their work.

In late September, The Times-Picayune requested permission to see the responses from all 26 contractors whose work was flagged by the city.

Only 9 respond to city

Records provided by the Nagin administration this week indicated that only nine contractors responded in any fashion. And most of those, the records showed, provided no evidence that they completed the work, such as pictures.

Still, city officials told 18 contractors last month that they need not provide further documentation, according to copies of letters released by the administration.

The letters show five contractors were cleared after city officials determined they had met their burden of proof. The other 13 received letters saying that "upon further review of the city's files and field reports, there is no additional information required at this time."

The latter group of 13 included Cedric Smith, the mayor's brother-in-law and owner of S&A Construction, the fourth-highest-paid company in the program. Initially, the city had questioned six jobs performed by S&A at a cost of about $18,000.


Overall, only four companies provided pictures of the job sites, and in many of those images, it was difficult or impossible to tell what work was performed. The only company to admit an error was Training Connection.

In an Aug. 14 letter to City Attorney Penya Moses-Fields, company owner Jean Washington said she reviewed eight properties her company remediated. In one instance, Washington wrote, workers accidentally cleaned up a property next to the one requested by the city, at 4910 Crowder Blvd.

"When I did my final inspection, I surmised that there was a mix-up with the address, and that we gutted 4912 (Crowder), " the letter said.

Washington hung up the phone when contacted by a reporter.

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