GUEST EDITORIAL

Don’t reward the scammers

 

OUR OPINION: BP needs to settle claims carefully, not just quickly

HeraldEd@MiamiHerald.com

In a recent report on CBS’ 60 Minutes, BP executives told correspondent Scott Pelley that of the billions of dollars paid out in claims stemming from the 2010 Deepwater Horizon oil spill in the Gulf of Mexico, some $500 million of that is fraudulent.

Among examples BP cited: A Pontiac dealer filing a claim saying the spill cost him car sales — but the real reason he closed shop is because General Motors killed the Pontiac brand after the spill; the owner of a phone store filing for a piece of the pie even though the store burned down before the spill; and an Iceland man claiming he fell and broke a leg while filling out a BP claim form.

There is no love lost here for BP, which discovered that inadequate preparation to deal with a mile-deep drilling accident can wreak environmental and economic disaster upon this country.

It must also be said that BP made the quick decision after the spill to start paying out claims just to make the issue go away as quickly as possible.

Through this past March 31, according to BP, the company had paid out $12.9 billion to businesses, individuals and local governments. Given what was basically an unlimited money supply — if BP were a mint, it couldn’t print the cash fast enough — everyone was looking for a check.

No oil made it to the Florida Keys, but this ribbon of islands is still eligible for BP money based on tourism lost because of just the fear of oil coming here. Many businesses rightly filed for compensation.

However, it also must be said that it is highly unlikely the Keys lost so much business, and employees lost so much in salaries, because of the spill.

Certainly not $184 million worth. That’s the amount BP paid out in Monroe County as of May 2012 — and claims were still being processed.

Since the claims process changed over the years, there is no way to know how much more has been paid locally and how much more is pending.

Doubtless, some of the fraud cited by BP came from the Keys. We’ve heard more than a few stories about people who didn’t have jobs when the spill happened but then filed claims, saying they were laid off because of the spill. Or businesses that vastly overstated actual losses. Could the Keys really have lost at least $184 million?

But BP agreed to settle many claims to avoid protracted litigation and stem the unending flow of bad publicity. The company botched its drilling and emergency procedures, then may have erred in its settlement

Make no mistake: We do not defend BP. It should pay all legitimate claims — and if it ends up costing another $12.9 billion, so be it. But scammers shouldn’t be rewarded.

©2014 the Florida Keys

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