Katrina Fraud

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"It is a crime to fraud the Red Cross!"

For that crime, Gordon Stewart with the local Red Cross says many people are now facing jail time.

"We found several cases in the beginning and now that we've gotten to look at our paperwork; we have hundreds starting today."

As of Monday there were two stacks of papers representing the scores of claims for people who allegedly received money under false pretenses from the Meridian office of the Red Cross. In all, officials say the stacks represent about $100,000 worth of money that was dispersed. However, officials say the bad thing is that the two stacks are just the tip of the iceberg.

"We know of one client who has received over $14,000 in checks," says Cheri Barry, who is the executive director for the Key Chapter of the Red Cross in Meridian.

Red Cross officials say most of the recipients received anywhere from $300 to $1,500 in emergency funding from Red Cross service centers. While some people received funding from more than one center, they say some others used fake address or listed an inaccurate number of people staying in the household to receive the money.

It is this type of behavior which local Red Cross officials say has led the national chapter of the organization to have to borrow money.

"The national American Red Cross is in debt three quarters of a billion dollars," says Barry.

Covering seven counties, the Key Chapter of the American Red Cross spent more than $4.5 million in providing emergency funding for local residents and evacuees in the wake of Katrina. The money was intended to assist only people who lost everything or whose house was severely damaged in the storm. Red Cross officials say they now hope to recover some of the money which was given under false pretenses.

The penalty for people found guilty for this type of fraud is three years in jail, a $10,000 fine and repayment of the money given.

"We are extremely serious about prosecuting people that have frauded the Red Cross," says Barry.

"We have to be thrifty with our donor dollars," says Stewart. "We want to make sure that donor intent is proven here!"

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