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FEMA Requests Repayment of Rita Funds

The federal government is asking 625 people in Texas to pay back a total of $1.26 million in recovery aid they shouldn't have received after Hurricane Rita.

Texas families received more than $592 million from the Federal Emergency Management Agency after the September storm.

Most of the money FEMA wants — $1.14 million — was incorrectly paid for damage to homes that were not the owners' primary residences, agency spokeswoman Hannah Vick said. Damages to secondary residences are ineligible for FEMA money.

In other cases, the same person received multiple $2,000 FEMA payments, or multiple people from the same household received the $2,000.

The agency began the process called recoupment, which is similar to an audit, in mid-March. A similar process is ongoing for payments made after Hurricanes Katrina and Wilma.

People who receive a letter requesting repayment have 30 days to submit the amount in full or set up a payment plan. After 30 days, 2 percent interest begins accruing. Residents can appeal FEMA's decision.

Typically, 2 percent to 3 percent of FEMA funds paid after a disaster are made improperly, FEMA officials have said. Sometimes errors are caused by incomplete applications. Sometimes, FEMA workers mistakenly approve payments.

Cases of suspected fraud are turned over to law enforcement officials.

Federal auditors have faulted FEMA for much of the benefit abuse after last fall's hurricanes, citing an inadequate accounting system. The federal Government Accountability Office has said thousands of inappropriate payments were made because people could repeatedly apply for and collect benefits.

In February, audits by the GAO and the Department of Homeland Security found that as many as 900,000 of the 2.5 million applicants who received aid under FEMA's emergency cash assistance program — which included $2,000 debit cards given to evacuees — were based on duplicate or invalid Social Security numbers, or false addresses and names.

Also in February, the Justice Department said federal prosecutors charged 212 people with fraud, theft and other crimes in scams related to Gulf Coast hurricanes.