Ex-FBI chief to lead probe of oil-spill claims

BP welcomes appointment of Louis Freeh in Gulf case

The Deepwater Horizon oil rig exploded and burned in 2010 in the Gulf of Mexico southeast of Venice, La.
Gerald Herbert/Associated Press/File 2010
The Deepwater Horizon oil rig exploded and burned in 2010 in the Gulf of Mexico southeast of Venice, La.

NEW ORLEANS — Former FBI director Louis Freeh was appointed Tuesday to investigate alleged misconduct by a lawyer who helped run BP’s multibillion-dollar settlement fund.

US District Judge Carl Barbier issued an order naming Freeh, who runs a consulting firm, a ‘‘special master’’ for the investigation.

Oil spill claims administrator Patrick Juneau said last month that his office is investigating allegations an attorney on his staff received a portion of settlement proceeds for claims he had referred to a law firm before he started working on the settlement program.


Freeh was a federal judge in New York before serving as FBI director from 1993 to 2001. He founded his consulting firm, Freeh Group International Solutions LLC, in 2007.

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Freeh had no comment Tuesday.

BP had called for an independent review of the allegations. A spokesman said it was pleased with the appointment.

In 2011, Pennsylvania State University hired Freeh to conduct its internal probe of the university’s handling of allegations that former assistant football coach Jerry Sandusky had been molesting boys for years.

In July 2012, Freeh issued a report that accused the school’s legendary head football coach, Joe Paterno, and other top Penn State officials of engaging in a coverup to avoid bad publicity. Paterno’s family and other targets of Freeh’s investigation vehemently denied the report’s conclusions.


BP is waging an aggressive campaign to challenge what could be billions of dollars in payouts to Gulf Coast businesses with claims arising from the company’s 2010 oil spill in the Gulf of Mexico.

The top attorneys representing plaintiffs in the spill settlement, Stephen Herman and James Roy, said in a statement: ‘‘We welcome Mr. Freeh’s appointment, and are confident that any impropriety, if confirmed, will prove to be an isolated incident.

‘‘We continue to have full confidence in Pat Juneau,” they said.

In April 2010, the oil drilling rig Deepwater Horizon exploded off the Louisiana coast, killing 11 workers. Millions of gallons of oil were spewed into the water. Marshes, fisheries, and beaches from Louisiana to Florida were fouled by the oil until a cap was placed over the blown-out well in July 2010.

BP set up a compensation fund and committed $20 billion. Juneau took over the processing of claims after the settlement was reached last year. His office has determined more than $3 billion in claims are eligible for payment.


BP argues Barbier and Juneau misinterpreted the settlement and have allowed thousands of businesses to receive hundreds of millions of dollars in payments for fictitious and inflated claims. BP appealed Barbier’s rulings on the issue. A three-judge panel is scheduled to hear the case on Monday.

Barbier said Freeh’s duties would not be confined to allegations involving the attorney, but would be a broader look at the claims settlement program.