US police forces that use military equipment earmarked for counter-terrorism to handle public order disturbances instead could be forced to repay millions of dollars in grants, under a review revealed during the first congressional hearings into this summer’s riots in Ferguson, Missouri.

The Department of Justice and the White House were already investigating whether to limit federal programs that have showered local law enforcement agencies with armoured vehicles and military-style equipment in recent years.

But the Department of Homeland Security, one of three US agencies primarily responsible for providing the equipment, said it was now considering whether to demand that its grants be repaid if police are found to have broken a little-known rule prohibiting its use in riot suppression.

“We have a range of remedies should [the DOJ] find non-compliance, including recoupment of funds,” Brian Kamoie of the Federal Emergency Management Agency told Kentucky senator Rand Paul during a hearing of the Senate homeland security committee.

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