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Subscribe to RSSBP agreed to pay the largest criminal fine ever brought against a single corporation; the U.S. government in turn agrees not to press more charges against the oil company responsible for the 2006 oil spill. NBC's Pete Williams reports.
Updated at 2:45 p.m. ET: BP will pay approximately $4.5 billion and plead guilty to manslaughter and other criminal charges as part of a settlement with the U.S. government over the deadly Deepwater Horizon rig explosion and massive oil spill in the Gulf of Mexico in 2010, the London-based oil giant and federal officials said Thursday.
The settlement total, to be paid out over five years, includes more than $1.25 billion in criminal fines -- the largest such penalty ever.
In addition, two BP employees have been indicted on manslaughter charges and a BP executive has been indicted on charges he lied to authorities about his work estimating the Gulf spill rate.
At an afternoon news conference in New Orleans, U.S. Attorney General Eric Holder called the wide-ranging settlement "the latest step forward in our ongoing efforts to achieve justice for those whose lives and whose livelihoods were impacted by the largest environmental disaster in the history of the United States."
He said the settlement amounts mark "both the largest single criminal fine … and the largest total criminal resolution" in U.S. history.
BP has agreed to plead guilty to 11 counts of felony manslaughter, one count of felony obstruction of Congress and violations of the Clean Water and Migratory Bird Treaty Acts, Holder said.
The agreement, subject to court approval, resolves all federal criminal charges and all claims by the Securities and Exchange Commission against the company stemming from the explosion and leak, the largest accidental marine oil spill in history.
“All of us at BP deeply regret the tragic loss of life caused by the Deepwater Horizon accident as well as the impact of the spill on the Gulf coast region,” Bob Dudley, BP’s group chief executive, said in a statement announcing the settlement.
Lee Celano / Reuters, file
A hard hat from an oil worker lies in oil from the Deepwater Horizon oil spill on East Grand Terre Island, Louisiana in this June 8, 2010 photo.
“From the outset, we stepped up by responding to the spill, paying legitimate claims and funding restoration efforts in the Gulf. We apologize for our role in the accident, and as today’s resolution with the U.S. government further reflects, we have accepted responsibility for our actions.”
“We believe this resolution is in the best interest of BP and its shareholders,” added Carl-Henric Svanberg, BP’s chairman. “It removes two significant legal risks and allows us to vigorously defend the company against the remaining civil claims.”
In addition, a federal indictment unsealed Thursday charges David Rainey, who was BP's vice president of exploration for the Gulf of Mexico, with obstruction of Congress and making false statements. He is accused of lying to federal investigators when they asked him how he calculated a flow rate estimate for BP's blown-out well in the days after the disaster.
Two BP well site leaders, Robert Kaluza and Donald Vidrine, were indicted on manslaughter and involuntary charges, accused of disregarding abnormal high-pressure readings that should have glaring indications of trouble just before the deadly blowout.
Rainey's lawyer said his client did "absolutely nothing wrong." And attorneys for the two rig workers accused the Justice Department of making scapegoats out of them.
"Bob was not an executive or high-level BP official. He was a dedicated rig worker who mourns his fallen co-workers every day," Kaluza attorneys Shaun Clarke and David Gerger said in a statement, The Associated Press reported. "No one should take any satisfaction in this indictment of an innocent man. This is not justice."
Before Thursday, the only person charged in the disaster was a former BP engineer who was arrested in April on obstruction of justice charges, according to AP. He was accused of deleting text messages about the company's response to the spill.
The Deepwater Horizon rig, 50 miles off the Louisiana coast, sank after the fiery explosion. The well on the sea floor spewed an estimated 206 million gallons of crude oil, soiling sensitive tidal estuaries and beaches, killing wildlife and shutting vast areas of the Gulf to commercial fishing.
On the docks in Louisiana, fishermen and oystermen say the effects of the BP oil spill remain today. NBC's Anne Thompson has more.
After several attempts failed, engineers finally managed to cap the gushing well on July 15, 2010, halting the flow of oil into the Gulf after more than 85 days.
The spill exposed lax government oversight and led to a temporary ban on deepwater drilling while officials and the oil industry studied the risks, worked to make it safer and developed better disaster plans.
Thirteen of the 14 criminal charges to which BP plans to plead guilty pertain to the accident itself and stem from the negligent misinterpretation of a negative pressure test conducted on board the Deepwater Horizon, BP said. The company said it acknowledged this misinterpretation more than two years ago when it released its internal investigation report.
The remaining criminal count of obstruction pertains to allegations that company officials lied to Congress about how much oil was pouring out of the ruptured well during the spill response.
As part of its resolution of criminal claims with the U.S. government, BP will pay $4 billion in installments over five years and has also agreed to five years’ probation.
The amount includes about $1.25 billion in criminal fines, nearly $2.4 billion to be paid to the National Fish & Wildlife Foundation and $350 million to be paid to the National Academy of Sciences.
BP said it will also pay the SEC $525 million over three years to settle all securities claims.
The $1.25 criminal penalty is the largest in U.S. history, eclipsing the nearly $1.2 billion paid by Pfizer Inc. for marketing fraud related to its Bextra pain medicine in 2009, according to Bloomberg and AP.
BP has also agreed to take more steps to boost safety of drilling operations in the Gulf of Mexico, including third-party auditing and verification, training and well control equipment and processes such as blowout preventers and cementing.
Under U.S. law, companies convicted of certain criminal acts can be debarred from contracting with the federal government. BP says it has not been told of any intent by government agencies to suspend or debar the company in connection with the plea agreement.
Still pending is a separate civil court action in which the federal government contends BP was grossly negligent in causing the spill. “We’ve been in negotiations with BP. We have not reached a number that I consider satisfactory to resolve those claims that we have,” Holder said.
The criminal deal announced Thursday with the Justice Department is also separate from a March settlement in which BP agreed to pay $7.8 billion to more than 100,000 businesses and individuals who say they were harmed by the spill.
The Associated Press contributed to this report.
PhotoBlog: Cat Island pelicans see habitat shrinking 2 years after Gulf spill
Archival video: The people of the Gulf Coast have survived hurricanes, but 128 days after the BP oil spill disaster, they're struggling to see a way forward. NBC's Anne Thompson reports.
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Oh man, all the wounds open up again at the mention of the spill. Just because most of you don't agree with the final verdict doesn't mean it is the wrong one! They were investigated and ultimately held accountable - if you want to penalize them more, then do as others said they were doing - don't buy their products. MOVE ON, PEOPLE, MOVE ON. There must be other things you need to worry about besides this!
Actually, we shouldn't move on. We need to remember this in order we do not repeat it. Move on means we will forget.
The fines are not nearly enough. The real tragedy here is that they are able to pay the fine and STAY in business. The fines should be so large that they go BANKRUPT!!
BP will pay NOTHING. We, as consumers, will pay ALL the costs involved. Businesses pass the cost of doing business on to their customers. It is just how it works. So all of you that think making various businesses pay higher fees and/or taxes as some form of punishment, are really only shooting the consumer in the foot, not the company. Companies are harmed in the pocket book by bad reputations that keep people from buying their various products.
Amazing.. If you have enough money you can buy your way out of prison. You and I commit a felony (or eleven).. We go straight to jail.
Those claiming the BOP system, cement job, etc. were to blame, somehow diverting responsibility away from BP, have no idea how these systems, programs, and operations are related and controlled. BP has drilled, completed, and produced thousands of wells. They used their experience and knowledge to circumvent regulations and industry standards to increase the profit margin. Criminal charges were possible because the investigation uncovered operational errors and management decisions that ultimately led to the explosion, deaths of workers, and subsequent damage to the marine environment in the Gulf and into the Atlantic.
Is that congressman from Texas still apologizing to BP?
As usual the higher ups get off with a mere slap of the wrist. $4.5 billion! Really? This is just the tip of the iceberg and doesn't begin to address the ecological destruction that may never be recovered again! Nobody goes to jail, nobody is truly held acountable: It just becomes a lawyer's side show circus- a game where some lame plea deal is made and everything's supposed to be ok. Wow, so they plead 'guilty'- that was a given! As an added adjunct every BP station in America and theri affiliates should be shuttered and thrown out of this hemisphere. @!$%# them- this is an outrage, boycott them!
12 felonies will get a person a lot of jail time, and corporations are people. One of the rights you lose when in jail is the right to conduct business. So if BP (like all corporations) is a person, put them in jail. Even if you can't physically lock BP up, you can take away its right to conduct business (at least in the US). Let's just assume one year for each felony...
$4.5 million is nothing to BP. I always knew they'd never get punished. You don't bite the hand that feeds.
Thank God we had President Obama at the helm and the able AG Eric Holder looking out for the Gulf coast folks. Had we had a Romney, Bush or Reagan (see Exxon Valdez) these poor souls would be in court forever and after appeals, 1/2 would have died as it happened in Alaska. BP reserved $20 billion and now it looks another $4.5 billion. 10 times over the Exxon Valdez settlement all in a span of 2 years. Kudos Mr. President!
Civil charges are still pending. Imagine Romney giving BP Habeas Corpus.....corporations are people my friend!
Yet, the ungrateful Gulf Coast folks of Louisiana, Mississippi and Alabama voted for Romney. Probably to reflect the desdain they still have for black humans
What about Florida stupid?
I'm sure all those checks will have a note on the back saying : "Not to be endorsed by Black Humans" Does someones race have to be injected into every subject?
Not enough! I would have asked, "Ok, so what is it worth to you to continue to drill and sell gas in the Western Hemisphere"?
10 times what they got off with I am sure.
Not enough money to be sure, but I hope it gets distibuted to those who lost businesses.
They just jack up the cost at the pump a few cents & we pay for it one way or the other. It would have been easier & faster for Hussein to just cut all the people on the coast (I live in Texas) a check & call it good. By the time all the Lawyers eat up their part, the people won't get $hit anyway. That way Hussein can say HE bailed all these people out. That would be good fodder for his third term in orifice.
Is there an insurance company involved with this? I can not get over that they would pay on something without a full investigation. I do not think this was an accident. Where is the oil? I think it was a dry well and a cover up. If there is oil at that spot then drill and show the oil.
Everyone on this board that's an American citizen will end up paying this fine over the years. When you have money you can buy your way out of anything. If they give this little fine to the Government they will just spend it elsewhere. Giving aid to foreign Governments even though the American People DO NOT WANT TO GIVE OUR MONEY AWAY TO SOMEONE ELSE THAT HATES US IF WE GIVE THEM BILLIONS OR NOTHING. This is not going to ever end until YOU decide it's enough.
Boycott BP stations if you want to get your point across.
You don't mean BP is going to pay the fine! You mean the American People that buy their products are the ones that will be paying their fine! Stop the BS, BP!!!!
But did they learn a lesson? Doubt it. If they had just done it correctly in the 1st place. But nooooooooo!
Yeah the beat goes on.
Rising gas prices! Hmm! Will continue? You bet.
Tax incentives for these criminals? I'm sure.
Little guy? Gets screwed again.
I've been a party to many a class action law suite. I receive about 6 cents on the dollar.
American Justice is deaf, dumb and blind. That you can take to the bank.
Another phuk up by Holder & Sons. Thanks Eric, you can put this on the mantle right next to that "Fast and Furious" phuk up.
4.5 may pay for one Mud Duck.But what about the rest of damage BP has done? Pay UP You Crooks
This is how BP's statement should have read. It's the truth:
“After dragging our feet for months and months, we responded to the PR disaster caused by our greed, negligence and lack of compassion. We orchestrated a complete "not me!" campaign and paid only those claims we were forced to, and funded the smallest number of restoration efforts possible. We'd like to apologize for our "role" in the accident, but that's not how we do things. We will NEVER ACCEPT FULL RESPONSIBILITY FOR OUR ACTIONS, AGAIN, THAT'S NOW HOW WE DO THINGS. From the beginning, we covered our ass every step of the way. Claims? Stuff it! Restoration efforts! Stuff it deeper. People died, but that's the price of doing business, right? Our negligence caused people to die, but, again, that's the price of doing business.
To summarize ... @!$%# you!"
4.5 billion is a drop in the bucket to this giant
i knew the small minded idiots would be blaming the president and our government.....and you morons wonder why your guy the liar lost !!!!! @ jersey michelle.....you are a complete moron.....people like you need to just stay out of politics....you constantly look like stupid little kids throwing tamtrums.......and you dont even deserve to have that flag on your post you ass...e !!!!!!
Wanna bet whose ultimately going to end up paying this fine?