FEMA losing head of Sandy insurance fraud probe

Brad Kieserman, the point person for the Federal Emergency Management Agency's investigation into allegations that superstorm Sandy homeowners were cheated by their flood insurers, is stepping down.

Kieserman, who had been elevated to head of FEMA's National Flood Insurance Program earlier this year, is departing for an executive position with the Red Cross. A FEMA spokeswoman confirmed the impending exit to the Asbury Park Press. It was first reported by Newsday. Kieserman's last day will be June 13.

The news broke less than 24 hours before Kieserman was to testify during a Congressional hearing into allegations of systemic flood insurance fraud in the weeks and months after Sandy.

His resignation also follows FEMA's first release of figures on the Kieserman-led Sandy Claims Review process, which in the first 10 days of the program fielded 800 requests for reviews from homeowners. Of those 800, 530 were found to be eligible for a second look.

In the months after Sandy, Jersey Shore homeowners frequently complained about what they perceived to be lowball payouts from their flood insurance providers. But FEMA wasn't prompted to address those complaints until evidence emerged of a potentially widespread fraud involving keyreports that serve as the foundation for whether a structural claim is approved or denied.

Part of the agency's response was to develop an all-encompassing claims review process, which opened on May 18.

A total of 142,000 policyholders who filed a claim after the storm will receive a letter from FEMA, informing them of their ability to challenge their Sandy-related claim payout.

Roy Wright, who has been leading disaster-risk reduction efforts within the agency, will temporarily replace Kieserman while FEMA searches for a permanent successor, according to a statement from FEMA.

"(Wright) will continue to implement the flood reforms that Brad began," said Rafael Lemaitre, FEMA spokesman. "Brad was a real change agent in the (NFIP) ... and that's going to continue under Roy Wright."

Sandy cases in court

Along with numbers on the claims review process, FEMA also provided an update on the status of lawsuits stemming from Sandy claims:

• 2,044 cases where policyholders had sued for underpayment had been filed in federal courts in New Jersey and New York. Some 800 of those were in New Jersey in March, according to a spokesman for the U.S. District Court of New Jersey.

• Of those claims that ended up in court, 423 had been settled before FEMA took control of the negotiations from the insurance providers.

• Since then, FEMA and policyholders have tentatively agreed to settle in 810 cases.

Russ Zimmer: 732-557-5748, razimmer@GannettNJ.com

Want to challenge your Sandy flood insurance claim?

The Federal Emergency Management Agency is sending letters to 142,000 policyholders who made a flood insurance claim after superstorm Sandy. If you think you were owed more for the damage you suffered than your insurance provided you, you don't have to wait for the letter to get the process started.

• Call FEMA at 1-866-337-4262 or go online to www.fema.gov/sandyclaims to download the request form, which you can email to FEMA-sandyclaimsreview@fema.dhs.gov or fax to 202-646-7970.