This past month, Ken Feinberg’s claim facility hailed “an important milestone” in processing more than half of the 256,000 oil spill claims it has received since December. However, a closer look at the numbers illustrates another example of the Gulf Coast Claim Facility’s (GCCF) continued failure to be forthcoming with folks on the Gulf Coast. For instance, Mr. Feinberg’s numbers rely almost entirely on “quick pay” settlements that require no documentation, involve pre-approved claims and marginal (if any) claim review. Significantly, these claims do not account for the thousands of financially-starved businesses and individuals that were wrongfully denied in the interim emergency process and now sit idle as their more substantive interim and final claims are reviewed. In total, only an estimated 168,000 of the 500,000 claims were paid in the interim emergency claims process.
Of the “more than half” of 256,000 claims processed, the quick pay claims account for nearly 100,000 or more. What’s worse, many of the individuals and businesses that signed their rights away at $5,000 and $25,000 did so during the Christmas season. Who can forget the media images of Gulf Coast residents forming lines outside the GCCF waiting to sign final settlements as Christmas presents and end-of-the-year expenses were coming due? Predictably, some of these same people are seeking to overturn the final settlement language and have filed lawsuits in Louisiana claiming they were wrongfully forced to sign their rights away.
Only 18,562 of the 155,000 applicants that filed interim or final claims have received offers. Disturbingly, of those 18,562 “offers,” only 40% were interim claims. This could mean that the GCCF is putting more emphasis on final claims to force individuals and businesses to settle out more quickly. Out of those same 155,000 interim and final claims, only 4% (6,632) have accepted offers from the GCCF.
Even more perplexing, the GCCF has denied 19,413 of the interim and final claims for failing to meet the extremely-high documentation standards that the GCCF requires. Moreover, 2,277 were told they would receive no further funds because they had already been covered by previous payments – even though we are less than one year removed from the spill and the full extent of damage to the Gulf Coast is unknown. David Wright, the owner of a south Baldwin County homebuilding company, who lost several contracts as a result of the spill, was forced to lay off workers. Those same workers were told by the GCCF that they would experience no further losses – even though they still remained unemployed. Mr. Wright had this to say: “They’re saying they had no loss when they’re unemployed. How can you say there’s no loss? You try to feed a family with no job.”
In summary, the GCCF has denied more Claimants than it has paid in the interim and final claims process; has only made offers on 12% of those claims; and is claiming a “milestone” when it has only paid 4% of the 155,000 pending interim and final claims. Sounds more like a BP milestone than a milestone for Gulf Coast residents.
Sources: The Mobile Press Register and Insurance Journal
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