Texas Man Told to Return FEMA Aid Money

A Texas man who received FEMA funds after Hurricane Ike is being asked to return the aid money.

Clay Gates applied for federal funds after Ike pushed four or five feet of saltwater through his La Porte, Texas, home in 2008. Gates said he jumped through hoops, showing officials every document and picture they asked to see.

“We got a letter saying, ‘Hey, you qualified for this amount of benefits,’” Gates told MyFoxHouston. “And the next thing you know they direct-deposited money in our account.”

Gates and his family received $23,000 from FEMA.

“We've done all the sheetrock, we've done all the painting, we've done everything ourselves so we could at least use the money the best we could, to get ourselves back up to square,” Gates said.

Gates still has more repairs to make, but last month FEMA asked for the money back, saying the family was ineligible for assistance all along.

“We're figuring we're going to lose our home,” Gates told MyFoxHouston. “We're going to lose everything we have. We don't know what to do.”

Gates appealed the decision, but on Sept. 24 FEMA sent a letter attempting to recoup $22,989.

Six days later, the US Treasury Department sent another letter saying Gates now owes $31,442, with fees, interest and penalties.

“Ten days to pay it or they're going to tack more,” Gates said.

Gates’ 10 days are up Monday. If he had the money to pay the government back, Gates says he would have never asked for help in the first play.

FEMA is working to recoup more than half a billion dollars from about 160,000 applicants who received improper disaster assistance payments over the last 6 years.

Some of the payments are the result of fraud, but some was paid out to people like Gates, who say FEMA led him to believe he qualified for money.

Gates says he did get someone at FEMA to admit they had made a mistake.

“And I asked her, I said, ‘Don't you see that this is wrong?’ And she said, ‘Yes, but it's too late. It's already at the IRS. Too late, can't do anything about it,’” Gates told MyFoxHouston.

FEMA won’t discuss Gates’ case specifically but says it’s required by law to recover money that was paid out improperly, regardless of whose fault it was.

Click here to read more on the FEMA money from MyFoxHouston.