NY Federal Court Says Flood Exclusion Bars Sandy Civil Authority Claim

According to a new monitoring report, at least 12 companies with questionable histories, including allegations of bribery, negligence and fraud, have performed work as part of New Jersey’s primary rebuilding program as a result of Hurricane Sandy. These findings followed earlier concerns that the New Jersey Department of Community Affairs’s vetting process for contractors involved in the Reconstruction, Rehabilitation, Elevation, and Mitigation (RREM) program was not thorough enough.

Chicago-based Navigant Consultant examined the histories of 74 contractors and subcontractors and 12 of them had been involved in suspicious incidents. According to the report, one company was involved, but not charged, in a criminal bribery scheme in another state, and others were defendants in civil cases dismissed on technicalities. The allegations in those cases included negligence, fraud, falsified environmental testing records, deficient building inspections, violations of labor law, and failure to pay workers’ compensation insurance premiums. The report concluded that because there was no proof of liability or that the firms were abusing the New Jersey program, the contractors should not be qualified. However, the report added that the claims “should have been identified and evaluated before these companies were engaged to work on these important programs.”