Apparently Hurricane Katrina isn't the only disaster that the federal government created wasteful programs in response.

It looks like the federal government had trouble making sure recovery loans went to the right people five years ago (via Yahoo News):

The government failed to ensure that recipients of terrorism-recovery loans were actually hurt by the Sept. 11, 2001, attacks, allowing banks to spread more than $3.7 billion in aid to whomever they wanted, Senate investigators concluded Wednesday.

According to the Senate investigators, almost any small business in America was eligible for a terrorism-recovery loan. The Senate Small Business and Entrepreneurship Committee, headed by Sen. Olympia Snowe, found that the program had very loose guidelines that allowed private lenders to approve loans for almost any borrower.

Many of the loan recipients failed to prove that they were affected by the Sept. 11th terrorism attacks (via Yahoo News):

Nearly 3 of every 4 loans made under the program contained either insufficient or questionable documentation to show recipients were actually hurt by the Sept. 11 attacks, Snowe's committee found.

A similar investigation done by the Associated Press last year found that only 10 percent of all the Sept. 11th recovery loans actually went to businesses located in the Washington, D.C. and New York City metropolitan areas.