BP aims to suspend settlement payments for Gulf Coast oil spill

BP has once again asked for a federal judge to temporarily suspend settlement payments to residents and businesses affected by the 2010 Deepwater Horizon oil spill, after pointing to a report alleging misconduct within the court-supervised programme.

Attorneys representing BP claim that the report highlights how the settlement programme has been beset by problems that must be solved in order to bring fairness to the case.

BP has already had two requests for suspension rejected by US district judge Carl Barbier, but is hoping that the new report - which was published by former FBI director Louis Freeh earlier this month but only after the oil giant's requests were rejected - will lead to Mr Barbier ruling in their favour.

In the report, Mr Freeh says that high ranking staff of Patrick Juneau, the claims administrator, had not only engaged in improper conduct but also acted unethically and possibly criminally.

Although the former FBI director said he does not yet think there is a need to suspend settlement payments, BP has argued that Mr Barbier would probably not have authorised Mr Juneau to begin processing and paying claims if the process was "riven with conflicts of interest", and conducted in a "grossly inefficient and over-costly manner".

"While BP does not presume to know for certain, it submits that the answer most likely would have been an emphatic 'no'. Instead, the Settlement Program would have been instructed to fix its problems first, before being allowed to open its doors to the claims of class members," the lawyers wrote.

The attorneys also note that the report suggests inadequate anti-fraud controls are in place, and pointed to claims that BrownGreer, a vendor for the settlement programme, has so far resisted attempts to curb its costs.

So far, BrownGreer has averaged more than $15 million per month in fees for its work on the programme and is now more of a hindrance than a help, BP claims.

The oil giant is now urging Mr Barbier to suspend all settlement payments until the programme is satisfactorily reformed by Mr Juneau and Mr Freeh, the latter of whom says his investigation into the programme is ongoing.