FTC says Resellers of Toxic FEMA Trailers to Gulf Cleanup Workers Could Face Criminal Charges

Lawmakers urge FTC, GSA and other law enforcement to aggressively investigate and monitor sale and use of contaminated trailers

August 6, 2010 - Today Representative Edward J. Markey (D-Mass.) and Representative Charlie Melancon (D-La), released a letter from the Federal Trade Commission (FTC) indicating that resellers of the former FEMA trailers that were contaminated with the carcinogen formaldehyde may be subject to criminal penalties for failing to disclose the health risk to purchasers and by implying that the structures were appropriate to be used for housing.

According to the FTC, while civil penalties could not be levied, the Commission could take a variety of enforcement actions including equitable monetary relief, cease and desist orders, bans and disclosure remedies. However, in light of the nature of the violation and the obligations imposed on purchasers of the FEMA trailers at the time of their sale, the FTC said "criminal action would likely yield the strongest remedy for consumers" who have been victimized by the deceptive sale practices.

"Like a zombie from a bad horror film, FEMA's toxic trailers just keep coming back to haunt the people of the Gulf coast," said Markey. "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."

"The fumes from toxic FEMA trailers cause serious respiratory illnesses, especially for children and seniors, and no one should be living in them," said Representative Melancon. "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."

The FTC letter was in response to an inquiry from Reps. Markey and Melancon who have also questioned the General Services Administration (GSA) on their oversight of the resale of these trailers, the response from GSA has not been received. According to several cases now being investigated by the Inspector General's office at GSA, companies that bought the trailers directly through GSA auction may have removed warning labels or otherwise not informed buyers that the trailers are not intended to be repurposed as homes. As a result several reports have indicated that these tainted trailers are being used to house some workers cleaning up oil from the BP oil spill in the Gulf of Mexico.

To read the response letter from the FTC, please click here

To read Reps. Markey and Melancon's original letter to the FTC, please click here