I am not talking to this specific case but about a general phenomenon that I see in my country, where people are being incentivized to build on hazardous areas by way of corruption.

Depending on the scale one could incentivized people to move to safer areas.

Arggh! excuse my autocorrect induced typos.

incentivize.

talking about

The threat of death from flooding is already a pretty good incentive, people accept the risk when it's the best option they have.

For some who are very poor yes I agree. But many are baited in by corrupt policies by a nexus of politicians and contractors/builders -- cheap land, cheap permits.