Resellers of FEMA trailers could face criminal prosecution

Anyone found reselling contaminated FEMA trailers for housing purposes could face criminal charges, the Federal Trade Commission (FTC) has clarified, responding to questions from House Democrats.

Thousands of trailers — leftovers from the Federal Emergency Management Agency's response to the 2005 Hurricane Katrina disaster — were banned as living quarters after the government found them to contain high levels of formaldehyde, a carcinogen. 

Still, many trailers have resurfaced amid the response to the Gulf oil spill. Reports have indicated that sellers are peddling them as housing units to Gulf cleanup workers despite explicit directions from the General Services Administration (GSA) that the units can't be sold as living quarters.

Those caught violating GSA's instructions, the FTC told Rep. Edward MarkeyEdward (Ed) John MarkeyOvernight Energy: US Park Police say 'tear gas' statements were 'mistake' | Trump to reopen area off New England coast for fishing | Vulnerable Republicans embrace green issues Vulnerable Republicans embrace green issues in battle to save seats Senate Dems introduce bill to keep pilots and bus and train operators safe MORE (D-Mass.), would not be subject to fines, but could face a number of other punitive actions, "including equitable monetary relief, cease and desist orders, bans and disclosure remedies." 

But given the safety threat — not to mention the GSA's warnings — criminal prosecution might be the best option, the FTC said.

"In light of GSA's ongoing efforts to address the potential criminal violations that have occurred in connection with reported resale and reuse of these trailers, it appears that a criminal action would likely yield the strongest remedy for consumers," FTC Chairman Jon Leibowitz wrote to Markey in a July 29 letter, which Markey released Friday.

That verdict drew approval from Markey, the chairman of the House Special Committee on Energy Independence and Global Warming, who has pushed GSA officials for answers surrounding the trailers since The New York Times reported in June that they were being marketed to oil spill workers. The Massachusetts Democrat is urging a crackdown on violators. 

"Like a zombie from a bad horror film, FEMA’s toxic trailers just keep coming back to haunt the people of the Gulf coast," Markey said Friday in a statement. "We need to ensure that the appropriate law enforcement agencies are thoroughly and vigilantly looking into these sales so that no one is unwittingly and needlessly exposed to the formaldehyde in these trailers again."

Some local lawmakers are weighing in with concerns as well. Rep. Charlie Melancon (D-La.) warned Friday that "the fumes from toxic FEMA trailers cause serious respiratory illnesses, especially for children and seniors, and no one should be living in them."

"Federal and local law enforcement must actively investigate any reports of trailers being sold for housing, to protect Louisiana families from breathing hazardous chemicals while they sleep," Melancon added.

Built in response to Hurricanes Katrina and Rita, the contaminated trailers quickly became a liability for the government, which was spending tens of millions of dollars to store them. In response, GSA auctioned off tens of thousands of trailers, with instructions that they couldn't be resold for housing purposes.

Despite the FTC's suggestion that criminal charges would be the most effective deterrent for potential resellers, the agency also cautioned that each case would be examined individually.

"Any definitive conclusion would require further investigation," Leibowitz wrote to Markey. "The remedy pursued would depend on the facts of the particular case."