BP Oil Spill Compensation Claims Still a Slow GoOct 5, 2010 | Parker Waichman LLP
Low Turnout Of Oil Compensation Claims
found by the BP oil spill compensation fund’s administrator will improve the claims process, but questionable claims and outright fraud continue to slow down efforts to get funds to economic victims of the disaster.
BP agreed over the summer to fund the $20 billion compensation account. In addition to submitting claims for emergency payments for six month of losses, people and businesses impacted economically by the spill can also apply for final payment of long term damages. While claimants don’t have to surrender their right to sue BP and other responsible parties if they accept emergency payments, they will have to give up that right to collect final damages.
Ken Feinberg, the Washington D.C. lawyer tapped by the White House to administer the fund, took charge of the claims process in August. At the time, he promised the claims process would be faster than it had been when BP was handling claims.
So far, Feinberg has had problems keeping that promise. While it’s still taking longer to resolve claims than Feinberg had hoped, some who have received emergency payments have complained that they are far lower than what was requested. According to the Associated Press, the fund has so far paid out nearly $1 billion to about 50,000 claimants. However, claims officials would not provide a total amount actually requested by those claimants.
98,000 Claims Filed
While Feinberg said he had heard complaints about low payouts and was planning to address the problem, he also told the Associated Press that claimants share some of the blame given the volume of claims filed with no proof of losses, inflated requests and fraudulent ones. Of the nearly 98,000 claims filed as of Oct. 2, about 35,000 require additional documentation and remain on hold, the Associated Press said.
In an interview with the Associated Press last week, Feinberg promised that problems would be fixed and more generous payments would come. The fund is also re-evaluating some previously paid claims and contacting claimants who believe they were short changed. In addition, Feinberg has decided that proximity to affected areas will no longer play a role in compensation approval, something that resulted in denied claims.
Some progress has been reported, according the Associated Press. In the past week, denied claims dropped from 528 to 116, as claims were paid to people and businesses initially told they would get no help.
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