Yesterday’s Washington Post headline read: “Fraud Alleged at Red Cross Call Centers; Contract Workers in California Stole From Katrina Aid Program, Indictments Say.”
According to the article, most of the fraud was committed at the Red Cross claim center in Bakersfield, Calif. As of this writing, nearly 50 people have been indicted in connection with a scheme that bilked hundreds of thousands of dollars from a Red Cross program to monetarily aid Hurricane Katrina and Rita victims.
Well, folks, I, too, worked on that Red Cross call center program in its Falls Church, Va., office.
The Post reported, “Seventeen of the accused worked at the Red Cross claim center in Bakersfield, Calif., which handled calls from storm victims across the country and authorized cash payments to them. The others were the workers’ relatives and friends, prosecutors said last week.”
“The scam,” according to the Post, “came to light when Red Cross officials noticed that a suspiciously high number of people were picking up Red Cross money at Western Union outlets near the Bakersfield center, even though few evacuees were in the area.”
The Post is accurate in its reporting. The article went on to say, “The incident reveals a sometimes chaotic system that the Red Cross cobbled together after the devastating storm get cash to desperate evacuees. Many had fled their homes with only the clothing they wore and what they could carry. Before winding up the program two weeks ago, the Red Cross gave out $1.3 billion to evacuees in more than 1.4 million households. It was the charity’s largest cash-assistance program ever — double the amount of cash it distributed after the Sept. 11, 2001, terrorist attacks, according to financial statements.”
The way the system was set up, it made it easy for people to defraud the Red Cross. But like the article said, something new had to be tried to get aid out to the victims. I was at Red Cross for about a month when our part of the project was abruptly terminated.
The system worked this way: Victims called in. We checked their zip codes to see if they lived within what FEMA and the American Red Cross called “effected area.” The information provided by victims — such as names, addresses and birthdates — were then verified by call center agents before evacuees were issued a claim number that they could submit to a Western Union office to receive payment.
We then found stores in their areas like K-Marts and the like that contained Western Union offices where they could get their money. The money came from contributions to the American Red Cross by donors, both individually and corporate.
Many of the cases I handled were from Louisiana and Texas and some from Alabama.
The Post went on to report, “In the days after Katrina tore through the Gulf Coast, Red Cross officials realized they faced a gargantuan task. Hundreds of thousands of evacuees fleeing the storm would need money quickly. Some left their homes with no identification, no cash and no access to their local banks.”
A Red Cross official was quoted in the Post article as saying because of the number of evacuees that headed to different states, the Red Cross realized it had to use some “nontraditional means for getting assistance to people.” I agree with that because if Red Cross had not embarked on some non-traditional ways many victims would not have received aid even now.
The Post also reported, “Red Cross officials decided to give aid to those who lived in Zip codes designated by the Federal Emergency Management Agency as the most severely damaged areas. They also set up call centers to field most of the claims — the first time in its history it had done so. Regardless of the damage suffered or individual needs, payments to evacuees were the same: $360 for a single-person household to a maximum of $1,565 for households with more than four people.”
That is exactly right. The Post was also accurate in reporting that, “To run the call centers, the charity contracted with a North Carolina company, 2XCL, which in turn subcontracted with a Florida staffing company, Spherion Corp., to hire hundreds of temporary workers to handle calls to the Bakersfield center and smaller call centers in Falls Church and Niagara Falls, N.Y. Red Cross also arranged with Western Union to issue cash to evacuees after they had been approved for assistance through the call centers,” according to the Post.
I am pleased to say that I did not witness any fraud on the part of employees at the Falls Church office. I was hired by the Spherion Corp. to perform the work. Most of those hired were retirees and college students. I even discovered another former Capitol Hill staffer like myself whose boss had retired from office was working on the project as well.
However, as we got further into the project many victims began calling in and using different names to try to get more money from the Red Cross. I listened over the phone when several attempted to do that and I was rescued by some very alert Red Cross supervisors.
No doubt by this time my conservative friends are seething over my praising an ultraliberal newspaper, but I have to give the Washington Post credit for its accurate reporting of the story.
I hate to see Red Cross receive this bad publicity. The Red Cross people and the folks I worked with on the project were great people to work with. I think most of them were honest. The morning shift that I worked was the best performing shift in getting aid out to the victims. Or at least we were told that by the supervisors.
I still believe in the Red Cross. Several Red Cross folks told me that Elizabeth Dole, now a North Carolina U.S. Senator, ran a tight ship when she was the head of it. They need another Elizabeth Dole type running the organization. If they don’t they will lose credibility and worse than that….valuable monetary contributions.