Authorities say up to 100 people in Pine Hill may have illegally obtained nearly $180,000 in Hurricane Katrina aid.
Local, state and federal agencies are investigating because Pine Hill was not considered as a disaster area by the American Red Cross.
But investigators say residents in the town still applied for and received the money.
According to a Red Cross spokeswoman, after the hurricane, the charity suspended its usual screening process because the storm caused such widespread damage. The agency said names and social security numbers were not always double-checked.
According to Pine Hill Police Chief John Brown, a Florida woman convinced her father, aunt and uncle, all Pine Hill residents, to apply for the money, using bogus names and social security numbers.
Brown said the woman helped fill out the applications, receiving cuts of the money. He said soon more applications were filed.
No charges have been filed and the investigation is ongoing.
Pine Hill is located in western Wilcox County.