BP Escrow Czar Promises Quick Claims Payments

couric feinberg
BP has vowed to pay every legitimate claim, but the House Judiciary Committee says the company has paid less than 12 percent of the claims submitted so far.

It released numbers today showing $600 million in claims have been filed and $71 million paid out.

Kenneth Feinberg was chosen to oversee the $20-billion compensation fund promised Friday to pay all legitimate claims quickly - in 30 to 60 days. He spoke with CBS News anchor Katie Couric from Baton Rouge, La.

Couric: Only a fraction of the claims submitted thus far by gulf residents have been paid by B.P. Why the logjam in your view?

Feinberg: I think the logjam is that this is a rather unprecedented situation involving thousands of would-be eligible claimants. The president has made it very clear to me he wants those claims paid quicker, in an accelerated fashion with less red tape and that's why I'm down in the Gulf today to meet with Governor Barbour and now Governor Jindal to talk about how to speed up that process.

Special Section: Disaster in the Gulf

Couric: Will BP have any jurisdiction over which claims are actually paid out or will that company just hand over the money?

Feinberg: That company has no say on the claims that I declare to be legitimate and eligible.

Couric: I guess the key words are "legitimate claims." After Hurricane Katrina, as you know, there were thousands of alleged cases of fraud or overbilling during the claims process. How will you be able to safeguard against that?

Feinberg: Fraud is an enemy of this program. We must make sure that every claim that's filed is legitimate, that it is eligible, it that it will be considered on its own merits, they won't all be paid. They will not all be paid.

Couric: Will $20 billion be sufficient to cover the losses gulf residents will suffer?

Feinberg: No one knows for sure yet, but the president made clear, and as I understand it BP went along, that if $20 billion is not enough, there will be additional funds provided by.

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Couric: You've said this escrow fund will expedite the process. But does it also shield BP from lawsuits?

Feinberg: Not at all. First of all, anybody who doesn't want to come into the fund doesn't have to. There will be individuals, businesses and lawyers who will prefer to litigate rather than come into this fund. I would urge every claimant in the Gulf regardless of whether it's a small business, large business, individual, I would urge everybody to come into this fund. It will not require that you pay 30 percent or 40 percent of your award to your lawyer and you'll get the money a lot quicker.

Couric: The administration says this process will be transparent. How so? Will all claimants and payments be made public? Will there be a web site to account for how the $20 billion has been paid out?

Feinberg: I'm sure there will be a web site and transparency as to how this money has been spent. I think we have to strike a balance between the public's right to know and the privacy rights of the individual claimants. I don't want individuals or small businesses to be chilled from filing a claim fearing that what they receive will be on the internet or will be made public the next day. That will defeat the purpose of the program.

Couric: BP has promised to pay for the cleanup, said there will be no cap on liability. In fact, you said they could go above and beyond the $20 billion. But what if BP goes bankrupt?

Feinberg: That would be a horror. A horror. If BP goes bankrupt, the bankruptcy lawyers will reap the benefit, I can tell you that. But the idea that BP will no locker be available to pay legitimate claims would be, I think, a tragedy. This program will not simply be an open run on the BP treasury.

To contact the BP claims facility: 1-800-440 0858

Watch the full interview below:

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