A BP escrow fund has been created by BP executives and also the Obama administration. The BP escrow fund could be used to pay the damages from the oil spill. Those that are damaged by the oil spill can be able to make a claim to this BP escrow fund. The $20 billion figure is not a cap, though some are questioning whether the escrow fund is going to help or hurt efforts to stop the gusher and clean up the environmental, political and economic mess.
BP escrow will not be a cap
Cleaning up the BP oil spill and restoring lost income could cost as much as $ 100 billion. Obama advisor David Axelrod assured the public today that “this is not a get-out-of-the-situation-free card.” The Obama administration has already said that if the $ 20 billion BP escrow fund is not enough to pay damages, BP will be responsible for a lot more.
BP escrow fund will be headed up by Kenneth Fineburg
Kenneth Fineburg works as the “pay czar” for banks that received the TARP bailout. A lawyer, Kenneth Fineburg has experience in administering disaster escrow funds – he administered the victims’ fund for the September 11, 2001 attacks.
Complaints spur creation of BP escrow fund
BP’s claims process has garnered complaints, which increased calls for a BP escrow fund style system. BP has paid some claims, but by no means all of them. Victims are being asked to provide up to two or 3 years of tax documents, among other documentation.
Will the BP escrow become a distraction?
Some politicians are questioning the timing of the BP escrow fund. In 2009, BP reported $ 5.6 billion in operating profits. However, Governor Haley Barbour of Mississippi has spoken out against the BP escrow fund. She expressed a concern that BP may consider it case closed once they pay to the fund.
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