$700 Million in Katrina Relief Missing, Report Shows

A new inspector general's report found that about $700 million awarded to help Hurricane Katrinavictims fortify their homes from future floods is unaccounted for, which Congressional leaders say is a troubling sign of the need for tighter controls as Superstorm Sandy rebuilding efforts intensify this spring.

The Department of Housing and Urban Development is pressing the state of Louisiana to recover the money given to homeowners to elevate their houses. But David Montoya, the inspector general of the agency, told ABC News that the likelihood of reclaiming the money was "slim, at best."

"We have $700 million that we can't account for and that certainly did not go to elevating homes and preventing future damage from storms," Montoya said in an interview in his office in Washington.

"This is money we can't afford to lose. This is money that we don't get back and this is money that we can't put toward other disaster victims."

The cases of government waste and fraud have steadily piled up since Hurricane Katrina ravaged the Gulf Coast in 2005. Federal prosecutors are pursuing criminal charges in New Orleans, including one instance last week in which a New Orleans woman pleaded guilty to making false statements after taking government grants and failing to fix her home.

The Louisiana Road Home program, which allocated $1 billion to elevate and repair homes to protect them from flooding and storms, was part of the $29 billion Hurricane Katrina relief effort approved at the time by Congress. The government investigation found that 70 percent of the money has not been accounted for. More than 24,000 homeowners who each accepted grants of $30,000 were unable to show they used the money to fix their houses.

"There is fault all the way around. Clearly the homeowner accepting up to $30,000 to elevate their home is at fault for not using the money that it was intended for," HUD's Montoya said.

He added, "Clearly the state's at fault for not doing a better job of due diligence if you will for ensuring that these homes were being elevated."

The state of Louisiana acknowledges that hundreds of millions of dollars from the program have not been accounted for, but officials told ABC News they are working to recover the money and pushing homeowners to restore their houses in hopes of minimizing damage from the next round of floods and storms. Since the federal investigation began last year, the state says that it has already tracked down 5,000 more people who have fixed their homes.

"We are working aggressively with HUD to get the remaining 19,000 homeowners in compliance," said Pat Forbes, who oversees disaster recovery in the administration of Gov. Bobby Jindal of Louisiana.

Sen. Tom Coburn, a member of the Homeland Security and Governmental Affairs Committee, said the lessons from Hurricane Katrina's relief efforts should stand as a stark warning as Hurricane Sandyrebuilding efforts intensify this spring in New Jersey and New York. He said the Obama administration should take steps now to avoid repeating the mistakes of Hurricane Katrina.

Coburn, an Oklahoma Republican who is among the loudest critics on Capitol Hill of government waste, outlined his concerns this week to Housing Secretary Shaun Donovan. In a two-page letter obtained by ABC News, he bluntly declared: "HUD must work to not repeat mistakes from previous programs."

Coburn said HUD should have a plan in place to ensure that people who receive grants use the money for its intended purpose. He said one area of particular concern is the $16 billion community development block grant program in the Hurricane Sandy aid package, which was signed into law earlier this year by President Obama after intense debate in Congress.

Senior officials at the Housing Department told ABC News that tighter controls are already in place for the Sandy rebuilding effort that were not operative during Hurricane Katrina.

"In the years since Hurricane Katrina, HUD has already implemented a number of the recommendations made by the Inspector General, including additional controls to ensure recovery funds are used properly," said Jerry Brown, a spokesman for the Housing Department.

But the call for stricter accountability in government spending rings hollow in the Gentilly neighborhood of New Orleans, where dilapidated houses remain an eyesore for Felicia Higgins, who said she went through a very "arduous process" to qualify for a government grant to elevate her home.

She believes some of her former neighbors are guilty of fraud.

"It hits you in the face every time you walk out the front door," Higgins said in an interview this week, standing outside her house that sits near abandoned and dilapidated property. "If they aren't going to spend the money for what it was intended, then they need to give it back."

Tina Marquardt, who works at Beacon of Hope, a community organization created to help New Orleans residents rebuild after Hurricane Katrina, said the people who received money from the Road Home Elevation Program should have been monitored to see if they were following the guidelines of the program.

"There needs to be a physical inspection of every property that received Road Home money," Marquardt said, adding that the damage is still taking a toll on New Orleans. "It decreases the quality of life in the neighborhood. It's an eyesore and it decreases the value of your own property."

More than seven years after Hurricanes Katrina and Rita struck the Gulf Coast, the rebuilding still continues, but the effort is underway with more urgency for the victims of Hurricane Sandy. Complicated bureaucratic rules that made it difficult for some homeowners to follow the guidelines of the program have been streamlined, officials said.

In an interview with ABC News, the inspector general said the home elevation programs were valid, but perhaps the owners should receive the money after they have completed their work on their property.

"Before you pay out funding such as this, up to $30,000 with a promise to do something," Montoya said, "we'd like to see the disbursement of these funds happen after the projects are done; almost a reimbursement to the state where inspections have been done to ensure that the homes were elevated."

2 men charged in kidnapping of 10-year-old CA girl

This image provided by California Department of Corrections and Rehabilitation shows Daniel Martinez, who was arrested March 31, 2013, in connection with the kidnapping of a 10-year-old girl who was snatched from her San Fernando Valley home in the middle of the night and abandoned hours later. (AP Photo/California Department of Corrections)

This image provided by California Department of Corrections and Rehabilitation shows Tobias Summers, a 30-year-old transient with a long criminal record, was identified by authorities over the weekend as a suspect in the case of a kidnapping of a 10-year-old girl snatched from her San Fernando Valley home in the middle of the night.(AP Photo/California Department of Corrections and Rehabilitation)

LOS ANGELES (AP) — A convicted felon planned to burglarize a San Fernando Valley home but ended up kidnapping a 10-year-old girl at knifepoint and sexually assaulting her after his partner in crime fled, authorities revealed Wednesday.

The details were included in charges that were brought againstTobias Summers, a 30-year-old transient who remains a fugitive, and his 29-year-old accomplice, Daniel Martinez.

According to police, Summers broke into the house in the middle of the night March 27 while Martinez waited in a getaway car. Summers emerged from the home with the girl and they both got in the car.

Martinez drove a short distance and then abandoned the vehicle and disappeared. Summers took the girl to a vacant home nearby where he held her captive, police said.

At some point, according to a criminal complaint, Summers sexually assaulted her and forced her to pose for nude photos. The girl turned up about 12 hours later after the harrowing ordeal, disoriented and disheveled.

Police Cmdr. Andrew Smith said it was unclear why Summers abducted the girl but investigators don't believe he had targeted her when he initially went to the home.

Summers was charged with kidnapping burglary and nearly three dozen counts of sexual assault. If convicted, he faces multiple life terms in prison.

Martinez was charged with one count each of kidnapping and burglary. He faces a maximum 12-year prison term if found guilty. A phone message left for deputy public defender Robert Kayne was not immediately returned.

The girl was snatched from her bedroom and was found wandering near a Starbucks about six miles away. She was barefoot, had bruises and scratches, and wasn't wearing the same clothes she had on when she vanished.

Both men have had problems with law enforcement in the past. Summers has a criminal record dating back to 2002 that includes arrests for robbery, battery and grand theft auto. Court records show Martinez has been convicted of burglary and grand theft.

Police have received more than 130 tips in recent days regarding Summers, who they believe may have fled to San Diego or Mexico and changed his appearance by shaving his head.

UK couple face jail for killing 6 children in fire

LONDON (AP) — Mick Philpott presented himself as an amiable rascal with an unorthodox lifestyle and a rambunctious brood of children — 17 in all, with five women.

Yet the Englishman's ramshackle existence took a horrifying turn when he and his wife set a fire that killed six of their children. Prosecutors said it was an attempt to influence a custody battle that "went disastrously and tragically wrong."

The May 2012 deaths and the twisting saga that ensued have shocked Britain and sparked debate on everything from sexism to Britain's welfare system.

A judge said she would sentence Mick and Mairead Philpott on Thursday for their manslaughter convictions in the deaths of Jayden, Jesse, Jack, John, Jade and Duwayne, aged 5 to 13.

Prosecutors said the couple hatched a plan to start a gasoline-fueled fire and then rescue the children, pinning blame on Philpott's mistress so he could gain advantage in their child custody battle.

The plan went wrong within minutes, because the fire was far bigger than expected and the father was unable to smash a window to get in, prosecutors said.

The couple and a friend who helped them, Paul Mosley, were all convicted of manslaughter this week at England's Nottingham Crown Court.

Before the fire, Philpott, now 56, was a local celebrity — nicknamed "Shameless Mick" after a television program about a disreputable working-class clan — who had appeared on a daytime talk show defending his lifestyle. In 2007, a Conservative lawmaker stayed at his home for a week as she filmed a critical documentary about Britain's welfare system.

The jury — and the nation — got a close-up look during the trial at Philpott's messy life with his 32-year-old wife, his girlfriend and as many as 11 children in a three-bedroom social housing property in Derby, central England. They heard of his threesomes and public sex, of Philpott's controlling behavior and of his bizarre claim that he had not washed for 12 weeks before the fire.

Shortly before the fire, girlfriend Lisa Willis moved out, taking her five children with her. Philpott's five children with Mairead and his wife's 13-year-old son from a previous relationship remained in the home and died in the blaze.

After the fire, the Philpotts made an emotional appeal on television, with Mick describing how he had battled the flames to try to save his children.

But police soon grew suspicious of the couple's erratic behavior and bugged the hotel room where they were staying. The jury was played recordings of Philpott asking his wife: "Are you sticking to the story?"

The couple was arrested two weeks after the fire and charged with murder, later downgraded to manslaughter.

"It was started as a result of a plan between the three of them to turn family court proceedings in Mr. Philpott's favor," said Crown Prosecution Service adviser Samantha Shallow. "It was a plan that went disastrously and tragically wrong."

Steve Cotterill, the assistant chief constable of Derbyshire Constabulary, said it had been "one of, if not the most upsetting cases any of us has ever investigated."

"Six young children lost their lives needlessly in a fire and all our efforts have been focused on getting justice for those children," he said.

The jury was not told that Philpott had a previous conviction for attempted murder for stabbing a former girlfriend and her mother when he was 21 or that he was on bail for road rage at the time of the fire.

The conviction of the couple was front-page news in Britain, with publications seeing all manner of social ills reflected in Philpott's mustachioed face.

To the liberal Guardian newspaper, he was "a control freak whose domestic violence went unchecked." For the conservative Daily Mail, he was "a vile product of welfare U.K." To the Daily Mirror tabloid he was simply "pure evil."

But their defense lawyers painted a different picture.

Anthony Orchard told the judge Wednesday that "despite Mr.Philpott's faults, he was a very good father and loved those children."

"Mairead Philpott was an extremely good mother to all 11 children," her lawyer, Shaun Smith, said. "No one, we respectfully submit, can dispute the grief that she feels."

Judge Kathryn Thirlwall said she wanted to "reflect further" and adjourned sentencing to Thursday.

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Corruption case reverberates from NYC to Albany

Good government groups hold a news conference on campaign finance reform outside the Senate Chamber at the Capitol on Wednesday, April 3, 2013, in Albany, N.Y. Advocates for campaign finance reform say the latest in a long string of political scandals shows the ongoing need to remove money from Albany politics. While acknowledging the bribery charges Tuesday against state Sen. Malcolm Smith involve his effort to run for mayor of New York City, which already has public campaign financing, the government watchdog groups say they included a promise of state money. (AP Photo/Mike Groll)

NEW YORK (AP) — It's a case that smacks of small-time corruption, with allegations of cash payoffs in parked cars. But the charges a Democratic state senator schemed to bribe his way into the GOP race for New York City mayor are playing out on a big political stage.

The case has already created political quicksand for Republicans just as the mayoral race is heating up and might have a second act in Albany, where the investigation is reviving corruption as a hot-button concern after Gov. Andrew Cuomo campaigned on pledges to rout it out.

"What it really does is make political corruption a much bigger issue than it has been" in the mayor's race, while upping pressure on Cuomo and other state leaders to do more to thwart it, said Paul Moses, a Brooklyn College English professor and former journalist who specializes in writing about New York City government and politics.

Good-government advocates held news conferences at both City Hall and the state Capitol Wednesday, a day after state Sen.Malcolm Smith, City Councilman Daniel Halloran, two high-ranking city Republican Party officials and the mayor and deputy mayor of suburban Spring Valley were arrested in a multi-pronged federal probe.

At the heart was Smith's yen to run for the Republican mayoral nod, despite being a Democratic member of the state Senate leadership.

While that might seem odd, a number of longtime Democrats have sought waivers or switched parties over the years to try to get the Republican ballot line in the mayor's race, rather than join a Democratic field that's usually more crowded with experienced politicians. And while Democrats dominate voter registrations and many city offices, none has held the mayor's seat in 20 years.

Federal prosecutors said Smith arranged to pay tens of thousands of dollars to two Republican officials to get waivers allowing him to try to get on the ballot as a Republican. Halloran, a Republican, got paid to help line up the illicit deals, prosecutors allege. Through their lawyers, both lawmakers have denied the allegations.

Smith is the latest in a string of state politicians who have faced corruption prosecutions in recent years, prompting Cuomo's 2010 campaign vow to clean up Albany. Steps so far have included cutting individual grants lawmakers direct to nonprofits and pushing through a law that allows for legislators to lose their pensions for committing felonies related to their jobs.

Yet on Wednesday, Cuomo wondered aloud about the persistence of the problem.

"Why do people continue to do things when they know it's wrong, it's illegal and they're going to get into trouble? That's the great riddle," he told reporters in Oswego.

Smith has come under scrutiny before. In 2010, New York's inspector general examined his and other legislative leaders' role in giving a video slot machine contract for the Aqueduct racetrack to a consortium that was later disqualified. Investigators said Smith continued advocating for the contract award after he said he recused himself. The report was referred to federal and city prosecutors, but no one has been charged.

Smith was seen as quite unlikely to get the mayoral nomination and never actually launched a campaign for it. Nonetheless, the alleged scheme has rippled through the Republican side of the race.

The GOP operations in two of the city's five boroughs are in upheaval, since Bronx Republican Party Chairman Joseph Savino and Queens Republican Party Vice Chairman Vincent Tabone both were arrested. Republican mayoral candidate John Catsimatidis quickly jettisoned Tabone as a campaign consultant and suspended him from his job as a lawyer for the billionaire candidate's businesses.

Another GOP mayoral hopeful, former Metropolitan Transportation Authority Chairman Joseph Lhota, distanced himself from backers he'd welcomed only weeks ago. Lhota said Wednesday that neither Savino nor Halloran, who both had endorsed him, would have any further role in his campaign.

The case is "a stain on the Republican Party," Lhota said by phone, but "I think it portends nothing for the race."

Leaders of the five borough parties didn't immediately respond to phone and email inquiries Wednesday, while state Republican Chairman Ed Cox urged Savino and Tabone to resign from their party offices.

With Democratic voters outnumbering Republicans by more than 6 to 1 in the city, mayoral elections provide local GOP leaders a key opportunity for influence — and fundraising. And some observers suggest the latter takes on an outsized role.

When Republican mayoral candidate George McDonald met with the borough Republican leaders last summer, "they weren't interested in message — they were just interested in how much money" he could generate in donations to the party, McDonald recalled Wednesday. McDonald, who runs an organization that helps the homeless, said he didn't expect the party leaders' support and so wasn't affected by the turmoil.

On the Democratic side of the campaign, mayoral candidate Bill de Blasio seized on another part of the corruption allegations: charges that Halloran took additional bribes in exchange for promising to allocate a company up to $80,000 in City Council "discretionary funds," or money that each member controls. It usually goes to nonprofit groups in the member's district. De Blasio called for banning discretionary funds, misuse of which has previously led to criminal convictions of three council members.

Halloran ran for Congress last year, losing to state Assemblywoman Grace Meng days before her father, former Assemblyman Jimmy Meng, pleaded guilty to wire fraud. Halloran brought up the case against the elder Meng during the congressional race, eliciting a stern response from his opponent's campaign.

Halloran is now running for re-election to his council seat.

Whatever effect the corruption charges have on politicians and parties, they also may add to the cynicism of an electorate that is all too accustomed to seeing such cases, said Christina Greer, a Fordham University political science professor.

"This just reinforces what so many voters think is already going on," she said.

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Associated Press writers Jim Fitzgerald in White Plains, N.Y., and Michael Virtanen in Albany, N.Y., contributed to this report.

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Syrian rebels set their sights on strategic south

BEIRUT (AP) — Syrian rebels captured a military base in the south on Wednesday and set their sights on seizing control of a strategically important region along the border with Jordan that would give them a critical gateway to attempt an attack on the capital, Damascus.

With foreign aid and training of rebels in Jordan ramping up, the opposition fighters have regained momentum in their fight to topple President Bashar Assad.

But while the fall of southern Syria would facilitate the rebel push for Damascus, it might also create dangerous complications, potentially drawing Syria's neighbors into the 2-year-old civil war. Besides abutting Jordan, the region includes territory that borders Syria's side of the Golan Heights, along a sensitive frontier withIsrael.

"This is a very sensitive triangle we are talking about," said Hisham Jaber, a retired Lebanese army general who heads the Middle East Center for Studies and Political Research in Beirut. "The fall of Daraa, if it happens, may usher in strategic changes in the area."

For the rebels, control of the south is key to their advance toward Damascus. Dozens of fighting brigades have carved up footholds in areas to the east and south of the capital, where they fire off mortar shells on the heavily guarded city.

The significance of their gains in the south was on display Wednesday when the rebels stormed a military base after a five-day siege.

"Damascus will be liberated from here, from Daraa, from the south," declared an armed fighter, a rifle slung over his shoulder and a kaffiyeh tied around his face. Videos posted online by activists showed him and other unidentified rebels celebrating inside the Syrian army's 49th battalion in the village of Alma, on the outskirts of Daraa.

"We will march to the presidential palace from here," said another fighter, amid bursts of Allahu Akbar, or God is great. The videos showed rebels from the Suqour Houran, or Eagles of Houran brigade, driving a Russian-made armored personnel carrier inside the base. "These missiles are now under our control," said a fighter, standing before a missile loaded on a truck.

Another video, posted by the Fajr al-Islam brigade, showed the rebels walking around the base as the heavy thud of incoming artillery rounds fired by nearby regime forces was heard in the background. A destroyed rocket, army trucks and radars were seen on the ground.

The videos appeared consistent with Associated Press reporting from the area.

The capture of the base is the latest advance by opposition fighters near the strategic border with Jordan. Last month, opposition fighters seized Dael, one of the province's bigger towns, and overran another air defense base in the region.

Opposition fighters battling Assad's troops have been chipping away at the regime's hold on the southern part of the country in recent weeks with the help of an influx of foreign-funded weapons.

Their aim is to secure a corridor from the Jordanian border to Damascus in preparation for an eventual assault on the capital. And they have made major progress along the way. Activists say several towns and villages along the Daraa-Damascus route are now in rebel hands.

A Western diplomat who monitors Syria from his base in Jordan said the fall of Daraa appeared imminent, possibly in the next few days or weeks. His assessment was based on classified intelligence information, he said, speaking on condition of anonymity in order not to hamper his intelligence-gathering efforts.

Daraa's fall could unleash lawlessness on Jordan's northern border and send jitters across the kingdom, a key U.S. ally which fears Islamic extremist groups on its doorstep.

Also of grave concern are rebel advances in areas near the Israeli-occupied Golan Heights.

"If Daraa falls, the rebels will come face-to-face with the Israeli army in the Golan," said Hilal Khashan, a political science professor at the American University of Beirut.

Daraa province separates Damascus from the Golan Heights, which Israel captured in 1967 and annexed in 1981. In recent weeks, Israel has seen Syrian mortar rounds and bullets land in Israeli territory and tanks enter a demilitarized zone in the Golan Heights. Israeli security officials believe the incidents have been inadvertent but have threatened to retaliate.

In addition to complications arising from rebels controlling the frontiers with Israel and Jordan, the fall of Daraa may drag in members of Syria's minority Druse community who live in the southern province of Sweida, Khashan said.

Like other minorities in Syria, they have so far remained largely on the sidelines of the uprising, but that could change if they feel threatened by the Islamic rebels.

The series of rebel gains coincided with what regional officials and military experts say is a sharp increase in weapons shipments to opposition fighters by Arab governments, in coordination with the U.S., in the hopes of readying a push into Damascus.

Thousands of fighters have entered Daraa in recent weeks, said Jaber, adding that rebels capitalizing on new weapons aim to use Daraa as a launch pad for reaching Damascus. Still, he and other analysts said the fall of Daraa would not change the balance of power unless the rebels acquire more advanced weapons.

More importantly, the rebels would also need to cut off the roads linking Damascus to the central province of Homs and from there to the Syrian coast.

Many observers believe Assad, as a last resort, would carve out a breakaway enclave for himself and his fellow Alawites in their historic heartland in towns and villages of Syria's mountainous coast, from which they would fight for survival against the Sunni majority battling to topple him.

The Syrian revolt started with peaceful protests but turned into a bloody conflict after some Syrians took up arms to fight a brutal government crackdown on dissent. The fighting has taken increasingly sectarian overtones, with Sunni Muslims dominating the rebel ranks. The Assad regime is dominated by Alawites, an offshoot Shiite group to which the president and his family belong.

The uprising began from Daraa, a largely agricultural region predominantly populated by Sunnis, in March 2011. Although long considered a regime stronghold, small protests began calling for the release of teenagers after they were arrested for scrawling anti-regime graffiti on the walls.

The conflict has turned into a civil war that the U.N. says has killed more than 70,000 people.

The rebels control vast portions of northern Syria bordering Turkey. They've also captured areas in the east along the border with Iraq recently, but the strategic region between the southern outskirts of Damascus and Jordan — known as the Houran plains — is seen as a crucial gateway to the capital.

Both sides consider Damascus, about 60 miles (100 kilometers) from the Jordanian border, the ultimate prize.

Millions of Syrians have fled the conflict, seeking refuge in neighboring Jordan, Lebanon, Iraq and Turkey, raising fears the civil war could spread across the region as the fighting occasionally spills over Syria's volatile borders.

In Lebanon, a Syrian jet fired a missile that slammed into a house on the outskirts of the border town of Arsal, causing material damage but no casualties, according to Lebanese state media. The Sunni Muslim town has backed opposition fighters in Syria, and arms smuggling is widespread in the area.

Lebanese gunmen supporting opposing sides of the conflict have frequently clashed, raising concerns the fighting could re-ignite Lebanon's explosive sectarian mix.

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