Fraud Accountability in Emergency Response Act of 2006 - Amends the Homeland Security Act of 2002 to direct the Secretary of Homeland Security, acting through the Director of the Federal Emergency Management Agency (FEMA), to ensure that: (1) all FEMA programs administering assistance develop and maintain proper internal management controls to prevent and detect waste, fraud, and abuse (waste); (2) application databases used by FEMA to collect information on eligible recipients record disbursements; (3) such tracking is designed to identify ineligible applications; and (4) such databases are integrated with disbursements and payment records.
Requires the Director to: (1) establish and implement a system for recording and tracking benefits disbursed by FEMA; (2) ensure that debit cards used to disburse assistance are equipped with an electronic feature that prohibits their use for ineligible expenses; and (3) assess the role of independent private sector inspectors general. Authorizes the Director to enter into contracts for the delivery of necessary goods or services relating to the response to or recovery from emergencies, giving preference to small businesses.
Requires the Secretary to: (1) ensure that any existing database for federal assistance programs administered by the Department of Homeland Security (DHS) undergoes a review by DHS's Inspector General; (2) annually certify that internal controls are in place and operational before a database may be used to disburse assistance; (3) establish and maintain a database that contains information about small businesses for purposes of federal contracting relating to assistance activities conducted in response to and recovery from emergencies; and (4) develop and implement a training program on the prevention of waste and ways to identify potential waste. Requires a DHS component to consult the database before awarding federal contracts for disaster-related activity.
Sets forth requirements regarding reports on expenditures and efforts to confirm the identity and eligibility of applicants for assistance. Establishes within the Inspector General's office the position of Deputy Inspector General for Response and Recovery.