The Attorney General’s Office is continuing to aggressively investigate fraud in Sandy relief programs, working jointly with the New Jersey Department of Community Affairs (DCA) and the Offices of Inspector General of the U.S. Department of Homeland Security, the U.S. Department of Housing and Urban Development (HUD), and the U.S. Small Business Administration (SBA).

The individuals who have been charged are alleged, in most cases, to have filed fraudulent applications for relief funds offered by the Federal Emergency Management Agency (FEMA). In some cases, they also applied for funds from a Sandy relief program funded by HUD or low-interest disaster loans from the SBA. The HUD funds are administered in New Jersey by the Department of Community Affairs.

“It’s shameful that dishonest people fraudulently exploit disaster relief programs for their selfish benefit, when these programs are intended to help those most devastated by the storm,” said Acting Attorney General Hoffman. “This type of opportunism is unconscionable, and we will continue to file criminal charges against any individuals who attempt it.”

The Division of Criminal Justice charged the following defendants today by complaint-summons:

• Vincent (Ajit) Agnihotri, 60, of Franklin Lakes, allegedly filed fraudulent applications following Superstorm Sandy for a FEMA grant and for state grants under the Homeowner Resettlement Program (RSP) and Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) Program. Agnihotri claimed that his primary residence in Ortley Beach (Seaside Heights) was damaged due to Sandy. It is alleged that the Ortley Beach house is actually a vacation property, and his primary residence is in Franklin Lakes. Agnihotri received the maximum amount provided by FEMA, $31,900. He also received a $10,000 RSP grant and a $75,000 RREM grant. In sum, Agnihotri allegedly received $116,900 through filing fraudulent applications. Agnihotri is charged with second-degree theft by deception and fourth-degree unsworn falsification.

• Luis Melendez, 35, and his girlfriend, Paulina Ramos, 29, both of Camden, allegedly filed three fraudulent FEMA grant applications for rental assistance: one following Hurricane Irene and two following Superstorm Sandy. For two of the applications, Melendez and Ramos allegedly asserted that they were forced to relocate to a rental home as a result of storm damage to their primary residence in Irene and Sandy. In the second Sandy application, they allegedly applied using the name of a relative of Melendez, who they falsely asserted was forced to relocate due to Sandy. In reality, the couple and the relative were never forced to relocate. Melendez allegedly submitted fraudulent leases and rental receipts in support of the claims. As a result of the three fraudulent claims, Melendez and Ramos allegedly obtained rental assistance from FEMA totaling $33,269. Melendez is charged with third-degree conspiracy, third-degree theft by deception and fourth-degree unsworn falsification. Ramos is charged with third-degree conspiracy and third-degree theft by deception.

• Donald Keany, 55, of Monroe Township, allegedly filed fraudulent applications for a FEMA grant and a state RSP grant following Hurricane Sandy. Keany received a total of $12,820, including $2,820 in FEMA rental assistance and $10,000 from the RSP program. Keany allegedly claimed that a vacation home located in Little Egg Harbor Township in Ocean County that was damaged by Sandy was his primary residence. In fact, it is alleged that his primary residence at the time of Sandy was in Monroe Township. Keany is charged with third-degree theft by deception and fourth-degree unsworn falsification.

“We now have charged 16 defendants with engaging in this type of fraud against Sandy relief programs, and we’re continuing to investigate these matters with our state and federal partners,” said Director Elie Honig of the Division of Criminal Justice. “These offenders not only drain funds away from deserving victims, they drain the time and resources of relief administrators and law enforcement personnel who must detect their crimes and prosecute them.”

“It is unconscionable that fraudsters are trying to steal RREM and Resettlement assistance from eligible applicants impacted by Sandy, so we will remain vigilant in pursuit of those who seek to misuse our recovery programs, ” said New Jersey Department of Community Affairs Commissioner Richard E. Constable, III.

The cases filed by the Attorney General’s Office were investigated by detectives of the New Jersey Division of Criminal Justice and special agents of the U.S. Department of Homeland Security Office of Inspector General, HUD Office of Inspector General and SBA Office of Inspector General. Deputy Attorneys General Mark Kurzawa and John A. Nicodemo are prosecuting the defendants. They are working with Lt. David Nolan, Sgt. Fred Weidman and Analyst Alison Callery, who are coordinating and conducting the investigations for the Division of Criminal Justice Financial & Computer Crimes Bureau, along with Detectives Katelyn Sake, Scott Stevens, Eric Ludwick and Jack Campanella.

Second-degree charges carry a sentence of five to 10 years in state prison and a fine of up to $150,000, while third-degree charges carry a sentence of three to five years in prison and a fine of up to $15,000. Fourth-degree charges carry a sentence of up to 18 months in prison and a fine of $10,000. The charges are merely accusations and the defendants are presumed innocent until proven guilty.

On Oct. 29, 2012, Superstorm Sandy hit New Jersey, resulting in an unprecedented level of damage. Almost immediately, the affected areas were declared federal disaster areas, making residents eligible for FEMA relief. FEMA grants are provided to repair damaged homes and replace personal property. In addition, rental assistance grants are available for impacted homeowners. FEMA allocates up to $31,900 per applicant for federal disasters. To qualify for FEMA relief, applicants must affirm that the damaged property was their primary residence at the time of the storm.

In addition to the FEMA relief funds, HUD allocated $16 billion in Community Development Block Grant (CDBG) funds for storm victims along the East Coast. New Jersey has received $2.3 billion in CDBG funds for housing-related programs, including $215 million that was allocated for the Homeowner Resettlement Program (RSP) and $1.1 billion that was allocated for the Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) Program. Under the Resettlement Program, the New Jersey Department of Community Affairs is disbursing grants of $10,000 to encourage homeowners affected by Sandy to remain in the nine counties most seriously impacted by the storm: Atlantic, Bergen, Cape May, Essex, Hudson, Middlesex, Monmouth, Ocean and Union counties. The RREM Program, which is the state’s largest housing recovery program, provides grants to Sandy-impacted homeowners to cover rebuilding costs up to $150,000 that are not funded by insurance, FEMA, U.S. Small Business Administration loans, or other sources.

The Small Business Administration provides low-interest disaster loans to homeowners, renters, businesses of all sizes, and most private nonprofit organizations. SBA disaster loans can be used to repair or replace real estate, personal property, machinery and equipment, and inventory and business assets damaged or destroyed in a declared disaster. Renters and homeowners may borrow up to $40,000 to repair or replace clothing, furniture, cars or appliances damaged or destroyed in the disaster. Homeowners may apply for a loan of up to $200,000 to replace or repair their primary residence to its pre-disaster condition. Secondary homes or vacation properties are not eligible for these loans, but qualified rental properties may be eligible for assistance under the business loan program.

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