Check out Federal government blasts PG&E’s deal with fire victims. FEMA has been in this position before because of the FEMA IG coming in post-disaster and requiring FEMA to "claw back" funds already paid, and likely spent, by individuals — because they deem the payments to be improper.
If the individuals who made claims to FEMA for Individual Assistance and were paid by FEMA also take money from PG&E, they are "double-dipping," which would be illegal and require FEMA to take action to get the original payment money back.
Who ends up looking like the bad guy? FEMA of course. I've said it before, it is hard to be FEMA sometimes.
