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.

“Lying to collect any form of public assistance is inexcusable, but it is especially egregious in the context of a major disaster like Superstorm Sandy, when all available funds are needed for those who were hardest hit and who legitimately qualify for aid,” said Acting Attorney General Hoffman. “These offenders also burden relief administrators, who must allocate time and resources to police this fraud, rather than focusing entirely on helping those most in need.”

The following defendants were charged today by complaint-summons. Each of these cases was referred to the Attorney General’s Office by the U.S. Department of Homeland Security Office of Inspector General, which conducted the investigations with the Division of Criminal Justice, the HUD Office of Inspector General and the SBA Office of Inspector General:

• Fred N. Perone, 80, and Anne M. Perone, 78, of Bonita Springs, Fla., allegedly filed fraudulent applications following Superstorm Sandy for FEMA assistance, a low-interest SBA disaster-relief loan, and state grants under the Homeowner Resettlement Program (RSP) and Reconstruction, Rehabilitation, Elevation and Mitigation (RREM) Program. As a result, they received a total of $91,900 in relief funds. It is alleged that the Perones falsely claimed that a storm-damaged home they own on West California Avenue in Beach Haven Park, Long Beach, N.J., was their primary residence at the time Sandy struck, when, in fact, their primary residence was in Florida, where they lived for more than six months of the year. As a result of the alleged fraudulent applications, they received the maximum amount provided by FEMA, $31,900, as well as a $10,000 RSP grant. In addition, they were approved for a $129,600 SBA loan, from which they received $50,000 in loan proceeds. Both Perones are charged with second-degree theft by deception. Anne Perone also is charged with fourth-degree unsworn falsification.

• Farry Bouza, 38, of Orange, N.J., allegedly filed a fraudulent application after Superstorm Sandy for FEMA assistance. It is alleged that Bouza falsely claimed that he was displaced from an apartment on Columbia Street in Newark due to Sandy damage and had to relocate to an apartment on Myrtle Avenue in Irvington. As a result, he received a total of $22,804 in FEMA relief funds for personal property damage, rental assistance, and moving and storage expenses. It is alleged that, in reality, Bouza did not reside at the address in Newark, and that apartment was not damaged and evacuated as a result of the storm. Moreover, Bouza never resided at the apartment in Irvington. He allegedly submitted false rent receipts and false storage locker receipts in support of his application. Bouza is charged with third-degree theft by deception and fourth-degree unsworn falsification.

• Mark Alessi, 53, of Toms River, N.J., allegedly filed a false application for FEMA assistance claiming that a storm-damaged home he owned on Shore Drive in Toms River was his primary residence when Superstorm Sandy struck. It is alleged that, in fact, Alessi and his wife had relocated to Las Vegas, Nevada, five months before Sandy, and they had listed the house in Toms River for sale. As a result of the alleged false application, Alessi received $2,270 in FEMA rental assistance. Alessi is charged with third-degree theft by deception and fourth-degree unsworn falsification.

“We’re working diligently with our state and federal law enforcement partners to ensure that every allegation of fraud involving these Sandy relief programs is thoroughly investigated,” said Director Elie Honig of the Division of Criminal Justice. “Our goal in all of these cases is to preserve funding for the many deserving victims of this historic storm who are trying to rebuild their lives.”

“It is unconscionable that fraudsters are trying to steal federal 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 27 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 (DHS-OIG), HUD Office of Inspector General and SBA Office of Inspector General. Deputy Attorneys General William N. Conlow, Naju Lathia and Derek Miller are prosecuting the defendants, under the Supervision of Deputy Attorney General Michael Monahan, who is Chief of the Financial & Computer Crimes Bureau, and Deputy Attorney General Mark C. Kurzawa, who is Deputy Bureau Chief. They are working with Lt. David Nolan, Sgt. Fred Weidman and Analyst Alison Callery, who are conducting and coordinating the investigations for the Division of Criminal Justice, along with other detectives, including Detectives Katelyn Sake and Thomas Page.

Second-degree charges carry a sentence of five to 10 years in state prison and a fine of up to $150,000. Third-degree charges carry a sentence of three to five years in state prison and a fine of up to $15,000, while fourth-degree charges carry a sentence of up to 18 months in state 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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