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Fraud And The Gulf Coast Oil Spill Compensation Fund

According to reports, in the wake of the April 2010 oil rig explosion and subsequent oil spill in the Gulf of Mexico, some business seized an opportunity to cash in. Florida authorities say Jean Mari Lindor filed $15 million in BP damage claims for himself and others for wages purportedly lost due to the spill’s economic hit on the region’s tourism industry. Authorities say that Lindor submitted as many as 700 suspicious claims, mostly for low-income workers who each paid him a processing fee of $300. As a result, Lindor and the other South Florida claimants were paid about $3 million from the Gulf Coast Claims Facility, which was established by British Petroleum after the protracted Deepwater Horizon spill.

According to the Department of Justice, Lindor, is among nearly 110 people nationwide who have been charged with defrauding the BP oil-spill fund program over the past two years. Authorities say the majority of the offenders have been charged in Alabama. According to the federal prosecutor, Lindor committed “multiple frauds” as he engineered an “affinity crime,” noting the majority of people who filed the loss claims through his business Noula, Inc., were of Haitian descent and lived in South Florida.

Legal sources say that under the BP fund program, any person or business in the United States or foreign countries could file compensation claims for lost wages or other economic damages caused by the disaster, as long as they submitted proof, including legitimate documentation, such as income tax returns and other financial records. Lindor’s attorney has said that “it seems that the allegations in this case are on par with BP’s continued representation that its rigs were safe,” adding that he was “skeptical of the government’s claim that the oil spill had no effect on people’s wages in the Keys area” because the potential threat of crude heading south scared away some tourists for months.

Reportedly, in other South Florida criminal cases, offenders have been accused of stealing the identities of others to file false claims with the BP fund. Sources say that in June, a Miami federal jury convicted Joseph Harvey and Anja Karin Kannell of using the “assumed identities” of hundreds of actual people living in the Florida Panhandle, Louisiana, Mississippi and Alabama to file fraudulent claims for millions of dollars in lost wages stemming from the spill.

However, representatives of the Gulf Coast Claims have pointed out that comparatively, instances of fraud have been modest. Sources say the Gulf Coast Claims Facility received about 1.1 million claims from all 50 U.S. states and 35 foreign countries, including applications from fishermen, hotels and restaurants. Overall, the GCCF approved more than one-third of those claims, totaling $6.5 billion in payouts to 226,000 claimants. The majority of applications were denied for lack of valid documentation, and a fraction for fraud.