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NEW YORK, Sept 6 (Reuters) - An investigation led by formerFBI Director Louis Freeh cleared the BP claims administrator ofmisconduct in handling settlement payouts from the 2010 oilspill in the Gulf of Mexico on Friday, but found some of hisstaff took kickbacks for referrals.
BP has said the multibillion-dollar settlement is beingmishandled by Louisiana lawyer Patrick Juneau and called for anindependent inquiry into allegations against a lawyer workingfor the administrator.
Judge Carl Barbier, who is overseeing the civil case on thespill in New Orleans federal court, named Freeh a "specialmaster" handling the probe in July.
Freeh found there was no evidence that Juneau "engaged inany conflict of interest, or unethical or improper conduct,"although he could not say the same of some employees.
"Despite the clear ethical 'tone at the top' and soundwritten policies established by Mr. Patrick Juneau, many of hiskey executives and senior attorneys engaged in conduct which theSpecial Master finds to be improper," Freeh said in the 93-pagereport.
Freeh found Louisiana lawyer Lionel Sutton, known as"Tiger," received a "referral fee" of around $40,000 to pass aclaimant to another lawyer while working for the administrator.The probe also named Christine Reitano, another administrationoffice employee, who worked with Sutton on the deal.
Juneau placed Sutton on administrative leave when theallegations first surfaced and he later resigned.
BP said Freeh's report confirmed its suspicions of fraud andunethical conduct within the claims process and companyspokesman Geoff Morrell said "immediate steps need to be takento prevent it in the future."
But Juneau said the incidents were isolated and that thereport found no evidence that the two employees "directlymanipulated the valuation of claims."
"We will continue the job of processing claims," saidJuneau.
The program was designed to compensate victims of the April20, 2010 explosion of the Deepwater Horizon drilling rig andrupture of BP's Macondo oil well, a disaster that killed 11people and resulted in the largest U.S. offshore oil spill.
BP has already incurred about $42.4 billion of chargesrelated to the disaster. It originally expected the payoutprogram to cost $7.8 billion, but has said the bill could bemuch higher.
The company considers Juneau's payout formula too generousand believes it compensates people who were not harmed.
BP is awaiting a decision by a federal appeals court on itschallenge to the payment formula, which U.S. District Judge CarlBarbier in New Orleans had previously rejected. Barbier on July19 rejected an earlier BP request to suspend payouts pendingFreeh's review. The judge also oversees a consolidated civillawsuit against BP and its contractors over the spill.
The case under Barbier is in re: Oil Spill by the Oil Rig"Deepwater Horizon" in the Gulf of Mexico, on April 20, 2010,U.S. District Court, Eastern District of Louisiana, No.10-md-02179. The appeal is "BP Exploration & Production Inc etal. vs Lake Eugenie Land & Development Inc, et al." in the U.S.Court of Appeals for the Fifth Circuit, No. 13-30329.
