Taxpayers are spending $326,000 fixing the waterfront vacation home of a serial financial criminal and former Olympic gold medalist, which is nearly as much as the house was worth.
The boondoggle last year came courtesy of the Federal Emergency Management Agency (FEMA) because Steven Riddick bought a home in Virginia too close to the water, leading to flooding, highlighting the agency’s often wasteful and inconsistent assistance programs.
Riddick was an Olympic sprinter in the 1970s, who then went on to coach at Norfolk State University, a historically black university in Virginia, where he was convicted of forgery for stealing in 2000. In 2007, he was again convicted of conspiracy, bank fraud and money laundering and sentenced to five years in prison, and applied for the federal funds from his cell.
To get the money from the same federal government that convicted him, the man who had repeatedly used deception for his own financial gain had to fill out an application listing how he had already received hundreds of thousands of dollars from insurance companies.
More than 300 home owners applied and were eligible for the program, but only six applications were forwarded to the state, which then tapped the federal government, meaning the vast majority of people in Riddick’s place were denied the help he got.
“Is that a problem?” Riddick, who also owns a second home in Maryland, told his local paper, which said that “Riddick’s home is valued at about $331,200, and U.S. taxpayers will spend nearly $326,000 to raise it.”
Prosecutors said Riddick deposited counterfeit checks for $375,000 and $450,000 — each big enough to buy an equivalent house that didn’t pose a flooding risk — into his bank account.
The check scheme was orchestrated by a drug kingpin in federal prison.
A book recounts Riddick’s accomplice, whose wife he coached, saying “They messin’ with my paper – my lifestyle – how am I gonna maintain my luxurious lifestyle?”
In all, the scheme netted $5 million.
“The National Flood Insurance Program is underwater itself, being more than $20 billion in debt,” Sen. Jeff Flake said in his Wastebook, a new list of wasteful government spending published Tuesday, which highlighted the incident.
“Despite this rising tide of red ink, the program was recently revised to provide owners 100 percent reimbursement for the price of elevating their homes. This ‘has been controversial because many homes along the coast are owned by the wealthy and the flood insurance and elevation grant programs do not look at income as a basis for reimbursement,'” Wastebook said.
FEMA’s efforts at Superstorm Sandy reconstruction have been similarly waste- and fraud-ridden.
But the agency has been called out by previous editions of Wastebook without cleaning up its act.
FEMA has played along as states have taken to openly gaming it, learning that if they declare “emergencies” on paper for even minor events like flurries of snow, the federal government will pay millions to local governments. It used a dollar threshold of damage for calculating “emergency” status that hadn’t been updated in 13 years.
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