Eight Charged with Defrauding BP Oil Spill Compensation Fund

Washington, DCThere is one in every crowd—or in this case, eight. As much concern as there was for the BP Oil Spill and the impact it would have on the lives and livelihoods of those directly affected, recent reports suggest that winter tourism at least is returning to normal levels in those areas. Meanwhile, there are reports of individuals defrauding BP and the federal government over compensation claims.

The New York Times reported on December 11 that eight individuals have been charged by the Department of Justice for making bogus damage claims.

Cam T. Hang is one such individual. It was reported that the Louisiana resident submitted a claim for $42,000 from the $20 billion compensation pool financed by BP for business losses to a restaurant that allegedly does not exist.

Hang isn't the only one allegedly trying to pull a fast one in the BP Gulf of Mexico oil spill compensation fraud file. Charlette Dufray Johnson, or North Carolina, is accused of filing claims on behalf of a sister who worked for a company in New Orleans that had suffered losses due to the Gulf of Mexico oil spill.

There's only one problem. The sister of Charlette Dufray Johnson is deceased.

The same woman is also alleged to have filed in the neighborhood of a dozen claims totaling nearly $80,000 related to other disasters such as Hurricane Katrina, various storms originating in Georgia and Tennessee, and a wildfire in California.

''The charges announced today send a strong message that we will not tolerate any fraudulent activity designed to profit from this tragic oil spill,'' said Assistant Attorney General Lanny A. Breuer.

Among the eight charged by the Department of Justice for Gulf of Mexico oil compensation fraud is Kevin Hall, a Michigan man who claims to be out $9,000 for lost business at an ice cream stand in Pensacola, Florida—the type of losses experienced by many when, at the height of the oil spill and clean-up efforts, the tourists stopped coming. Hence, fewer ice cream sales.

However, it is alleged that the ice cream stand also does not exist.

''The fund is working closely with the Department of Justice," said Kenneth Feinberg, the administrator of the BP oil rig spill compensation fund. "We are internally reviewing hundreds of suspicious claims, and we are going to send any we deem fraudulent to the Department of Justice.'' The indictments were announced December 10 against people in Louisiana, Alabama, Mississippi, Texas, Michigan and North Carolina.