Authorities brace for wave of fraud on the Gulf

GULFPORT, Miss. — Hurricane Katrina battered Raquel Romero’s home, but she figures the house took a worse beating from the contractor she hired to repair the damage.

The contractor tore off her damaged roof and left her Long Beach home exposed to the elements for several days. Rainwater caked her kitchen and laundry room in sludge and destroyed belongings that survived Katrina.

The contractor built Romero a new roof, but Romero says it was so poorly done she had to hire someone else to replace it. And the first contractor refused to refund any of the $20,000 she paid him.

“The contractor caused more damage than the storm did,” she says.

Finding an honest, readily available contractor is a challenge these days on the Gulf Coast, where last year’s epic storm demolished tens of thousands of homes. With most reputable contractors booked for months, con artists are filling the void and preying on desperate homeowners, law enforcement officials say.

To date, home-repair rip-offs have accounted for only a modest share of the hundreds of millions of dollars in fraud that followed in Katrina’s wake. But authorities expect the problem to grow worse as billions in federal grant money starts to flow to homeowners in Mississippi and Louisiana.

“I think we’ll see an unprecedented congregation of some of the best con men in the world to converge on our Gulf Coast and New Orleans when this taxpayer money hits the ground,” Mississippi Attorney General Jim Hood said.

Hunting unscrupulous contractors is Ron Werby’s job. He went to work in July as an investigator for the Sheriff’s Department in Harrison County, Mississippi’s most populous coastal county, weeks after retiring from the FBI’s joint terrorism task force.

One of the first cases Werby investigated was Romero’s. She filed a complaint against the contractor, and a judge later issued an arrest warrant charging him with home-repair fraud. The contractor is one of dozens charged with defrauding homeowners since Katrina struck Aug. 29, 2005.

Werby’s growing stack of case files also includes that of Lore and Carroll Allen, who have been living in a government-issue trailer since Katrina destroyed their home in Pass Christian.

Lore Allen, 82, told Werby that in March the couple paid a contractor $30,799 to erect a steel-reinforced cottage on their old property. Workers built the foundation, frame and siding, but more than $10,000 worth of work was left to be done when they stopped showing up in July, she said.

A month later, the contractor sent a letter notifying the couple that it is no longer doing business in Mississippi. No reason was given, Lore Allen said, fighting back tears.

“Is it possible we’re going to get some money back?” her husband asked.

Werby explained he cannot intervene in civil disputes, but in a criminal case a judge can order restitution.

“Well, we could sure use it,” said Carroll Allen, 87, a decorated World War II veteran.