Crime, No Punishment: BP Gulf Settlement Deal "Pathetic" say Groups

Bird after BP disaster (Photograph: Gerald Herbert/AP)

Crime, No Punishment: BP Gulf Settlement Deal "Pathetic" say Groups

'Fine amounts to a rounding error for a corporation the size of BP'

British oil company BP plead guilty to 14 felony and misdemeanor charges and agreed to pay $4.5 billion in fines on Thursday, over the 2010 Deepwater Horizon oil rig disaster in the Gulf of Mexico.

However, the resolution was reportedly made in exchange for a waiver of future prosecution on the charges, and critics say it will not come close to covering the untold damage caused by the disaster and outstanding federal civil claims.

"Today's announcement of a proposed settlement between BP and the US government fails every aspect of the commonly accepted notion of penalty," said Greenpeace senior investigator Mark Floegel in response to the news.

"We're stunned. This settlement is pathetic," said Public Citizen's Tyson Slocum. "The $4 billion penalty is equivalent to just a fifth of the company's 2011 profits."

"The point of the criminal justice system is twofold: to punish and to deter. This does neither," he said.

Describing the deal as "a weak-tea punishment" Slocum said it would provide zero deterrence against reckless behavior by BP or other companies in the future.

"Although the government is right to pursue manslaughter charges against two individuals BP employees, the settlement is inadequate to address BP's repeated criminal conduct," Slocum said.

"This proposed settlement would not hold the guilty accountable for their actions. This fine amounts to a rounding error for a corporation the size of BP," said Floegel. Echoing Public Citizen's assessment, he added that "nothing in this proposed settlement gives any oil company incentive to be more careful in future operations. Cutting corners and skimping on safety will still be the rule of the day."

The Gulf Restoration Network on their facebook page, said the deal doesn't even come close to punishing the oil giant for the devastation caused. "BP still has a long way to go to making the Gulf whole, and the company must be held accountable to the full extent of the law."

The resolution is still subject to US federal court approval.

In total, the agreement reached between BP and the US Department of Justice found BP guilty of 11 charges of felony, including counts of misconduct and neglect relating to the death of 11 workers on the oil rig, but only found one misdemeanor count under the Clean Water Act, one misdemeanor count under the Migratory Bird Treaty Act, and one felony count of obstruction of Congress for lying about how much oil was pouring out of the ruptured well during the crisis.

The BP spill polluted the Gulf of Mexico with 200m gallons (4.9 million barrels) of oil over a three month period, causing damage that will take decades to fully comprehend, environmental and public advocacy groups are saying today. The charges, deemed the "largest corporate criminal penalty" in history pale in comparison to the priceless ecosystem of the Gulf of Mexico, the groups warn.

According to Public Citizen, the damages associated with Clean Water Act violations alone have been estimated at $21 billion.

"Claims arising from the Gulf disaster, which killed 11 workers and did untold damage, puts the company's liability at a minimum of $51.5 billion," Public Citizen writes today.

The group continues:

Any settlement must allow for full recovery of the Gulf Coast region and its communities; deter other companies from putting profits before safety; and involve the disclosure of all information gathered by the government, so the public has a complete understanding of the wrongdoing that killed workers and continues to wreak havoc on the environment. [...]

A settlement must place financial responsibility on BP for future environmental and economic costs caused by still-undiscovered damage. The costs to the environment from the release of more than 5 million barrels of oil and hundreds of thousands of gallons of chemical disbursement may not be known for decades. [...]

Permanent sanctions must be part of the settlement. For example, the government should restrict BP's access to future and current government oil and gas leases, and bar it from federal contracts for good.

The statement by Greenpeace added:

BP management is clearly hanging low-echelon technical and engineering staff out to dry while making no significant changes to their disastrous business model. [...]

This proposed settlement would give a green light for more reckless behavior in environments across the globe. Shell will now be eager to return to the Arctic Ocean in 2013, knowing that its inevitable oil spills will be met with similar slaps on the wrist.

Indeed, if one looks at the fate of BP's stock price - the only metric of value in the corporate world - it's clear that far from a penalty, this proposed settlement would be a reward to BP.

Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.