Two-thirds of the tested payments lacked support
A HUD inspector-general audit of Puerto Rico disaster-recovery funds found 49 of 74 tested nonfederal-match payments unsupported. That is 66.22% of the sample, representing more than $47.8 million in tested payments.
Unsupported is an audit classification: the administering entity did not provide adequate evidence for the auditor’s test. It is not, by itself, a finding of fraud or a final debt determination.
| Measure | Result |
|---|---|
| Payments tested | 74 |
| Unsupported payments | 49 (66.22%) |
| Unsupported tested value | More than $47.8 million |
| Projected unsupported value | $54.8 million |
| Unspent funds to protect | More than $617 million |
Commingling affected 26 sampled payments
The audit also found that 26 of 74 payments—35.14%—mixed other disaster-recovery expenses into the match-payment process. Those tested payments exceeded $2.8 million, and the auditor projected at least $7.17 million affected.
Commingling complicates traceability even when an underlying expense may be eligible. Separate accounting is what lets auditors connect a payment to the purpose Congress authorized.
The recommendation reaches forward, not only backward
The watchdog recommended that unsupported costs be documented or repaid and that more than $617 million still unspent be protected through stronger controls. That prevention figure is much larger than the questioned sample.
A responsible closure record should show which sampled costs were validated, which were repaid and what control changes were tested before additional funds moved.
Method and limits
The newsroom calculated percentages from the official count of tested payments and retained the auditor’s labels for dollar estimates. It did not extrapolate beyond the report’s own projections.
The sample is not every Puerto Rico recovery payment, and an unsupported item can later be substantiated. The report establishes documentation and segregation failures, not criminal intent.
Sources and further reading
HUD OIG, Puerto Rico nonfederal-match audit, October 8, 2026 ↗
FEMA Hurricane Georges damage photograph and public-domain record ↗