BP Gulf Spill Compensation Fund to be Audited

By PETE YOST | July 25, 2011

An independent audit will be performed on the $20 billion fund set up to compensate victims of last year’s BP oil spill in the Gulf of Mexico, Attorney General Eric Holder announced Wednesday.

In a letter to the fund’s administrator, Kenneth Feinberg, Holder stressed that the goal is to balance the need for resolving claims quickly and fairly along with the need to start an audit before the end of the year.

Holder said the fund’s “highest priority” should be to achieve speed and fairness.

Holder made a June 30 trip to the Gulf Coast in which he heard concerns from Alabama officials and residents about the transparency of the claims process.

In his letter, the attorney general said Feinberg agreed to an audit, a step that Holder has been urging for some time.

In response, Feinberg said the audit will begin this year but won’t disrupt “the timely processing of claims.” He said the audit “is something we have always considered we would do.”

To date, the fund has paid $4.7 billion to 198,475 claimants. The total number who have sought money stands at 522,506, many with multiple claims. In all, the fund has nearly 1 million claims and continues to receive thousands of claims each week.

Feinberg also oversaw payouts from the victims compensation fund that was set up after the Sept. 11, 2001, terrorist attacks. The procedures to implement the 9/11 fund’s activities were audited, said Deborah Greenspan, the fund’s deputy. Feinberg said the 9/11 claims themselves were not audited, due to confidentiality requirements and proprietary information. He noted that the fund did issue a final report that laid out overhead costs and expenses related to claims.

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