In the days and weeks following Hurricane Katrina’s devastation of New Orleans, it’s understandable that FEMA would give a higher priority to helping the needy than to assuring that they really were needy. It’s more difficult to excuse wasteful payment of fraudulent claims that came months after the hurricane dissipated.

A GAO audit shows that FEMA has an ineffective oversight process and therefore continues to pay fraudulent claims. FEMA has wasted or been cheated out of at least $1 billion. At the same time, it hasn’t always put the money where it’s really needed, resulting in a recent court order “to resume housing payments for thousands of people displaced by Katrina.”

Not all of the loss resulted from fraudulent claims. FEMA can’t seem to keep track of the equipment that its employees purchased: