Next Score View the next score

    Corruption in BP settlement program, Louis Freeh says

    NEW ORLEANS — An independent probe led by former FBI director Louis Freeh found evidence of a plot by lawyers to ‘‘corrupt’’ the BP settlement program but nothing that warranted shutting down payments to victims of the company’s 2010 oil spill in the Gulf of Mexico, according to a report issued Friday.

    Freeh, who was appointed by a federal judge to investigate alleged misconduct by a staff attorney who worked on the settlement program, cleared court-appointed claims administrator Patrick Juneau of engaging in any ‘‘conflict of interest, or unethical or improper conduct.’’

    But the former FBI director concluded that top members of Juneau’s staff engaged in conduct that was improper, unethical, and possibly criminal. He recommended that his report be forwarded to the Justice Department.


    ‘‘The nature and seriousness of this type conduct varied in degree but was pervasive and, at its extreme, may have constituted criminal conduct,’’ the report said.

    Get Talking Points in your inbox:
    An afternoon recap of the day’s most important business news, delivered weekdays.
    Thank you for signing up! Sign up for more newsletters here

    Juneau said Freeh’s report validates his team’s work, and he played down the alleged misconduct by two former members of his staff as an ‘‘isolated situation.’’

    ‘‘We will continue the job of processing claims,’’ he said in a statement. ‘‘We welcome the recommendations from the Freeh report and we look forward to working with him to help improve all aspects of the claims process.’’

    BP spokesman Geoff Morrell said the report ‘‘confirms what BP has suspected for some time: There has been fraud and unethical conduct within the facility itself and among various claimants and their lawyers — and immediate steps need to be taken to prevent it in the future.’’

    Two of the lead plaintiffs’ lawyers who brokered the settlement with BP last year said Freeh’s report ‘‘confirmed what we knew to be true all along: that Patrick Juneau has, for more than a year, led the Court-Supervised Settlement Program with integrity, transparency, and objectivity.’’


    While the report points to certain conduct within the program as problematic, Freeh said, ‘‘this should not prevent the (settlement program) from fairly and efficiently processing and paying honest and legitimate claims in a timely manner.’’

    It also found that two private attorneys — Glen Lerner and Jon Andry — used Lionel Sutton, a lawyer on Juneau’s staff, to expedite a claim by their firm for nearly $8 million. In return, Sutton received more than $40,000 in fees from payments on claims he had referred to their law firm before joining Juneau’s staff, the report says.