British Petroleum in court hearing alleging misconduct in the oil-spillage payments

8 July 2013 Last updated at 16:10 Share this pageEmailPrint

BP in court hearing alleging misconduct in oil-spill payments

Oil giant BP is back in court in the US to try to limit compensation payouts from a fund set up to help those affected by the 2010 Deepwater Horizon oil spill in the Gulf of Mexico.

BP and businesses are laying arguments before three judges in New Orleans.

The oil giant wants the panel to overturn a federal judge’s ruling that upheld a claims administrator’s interpretation of the settlement.

The company claims some payments are for fictitious and inflated losses.

It says the administrator has wrongly allowed payments of hundreds of millions of dollars to businesses.

But the businesses’ lawyers say that BP underestimated how many claims it would have to meet.

Last week it was revealed that a former FBI chief, Louis Freeh, would look into claims of misconduct relating to the payments.

BP, which has warned that the compensation system is being abused, welcomed the appointment.

The explosion of the oil rig killed 11 workers and released an estimated four million barrels of oil into the Gulf and along the coastline.

BP put aside $7.8bn (£5.2bn) when it agreed to pay compensation in 2012, but the company has become increasingly concerned that the final figure would be much higher.

BP said in its statement that Mr Freeh had been granted “wide latitude” to look for other possible misconduct within the Court Supervised Settlement Program.

BP has no control over its payments to claimants having agreed to a compensation formula and framework.

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