by Marian Wang

At ProPublica, we're always following what officials say. Sometimes they mislead, sometimes they apologize, and you know, sometimes they just say the darndest things.

To commemorate those moments, we’ve started a Tumblr—a kind of super-simple blog—cataloging what officials in business and government (and any other centers of power) let slip. We're calling it, Officials Say the Darndest Things. 

Please, send us quotes to include. And, if you’re on Tumblr, be sure to follow along and spread the smiles. We could all use a little more of that.

by Marian Wang

Yesterday we flagged a curious line in a recent letter from Texas officials to BP, in which the Texas governor and attorney general wrote that BP lawyer Jack Lynch had told them "gross negligence" was a possible cause of the Gulf spill. The Houston Chronicle first reported on the letter, and quoted a BP official saying the letter was incorrect. Here's the company's full response to us—it's similar, but includes a few more details about what BP felt was the relevant part of that conference call:

While BP respects Governor Perry and Attorney General Abbott and appreciates the opportunity to work with them, the recitation in their letter is simply a mistake. During the May 6, 2010, conference call, neither Jack Lynch nor any other BP representative stated that gross negligence would be revealed as the cause of the Deepwater Horizon tragedy. The pertinent part of the May 6, 2010, call was a discussion among lawyers about certain provisions of the Oil Pollution Act of 1990.

That's also how the Texas officials described it—a conversation about the Oil Pollution Act. In their July 22 letter, they said BP wasn't invoking the Oil Pollution Act's liability cap because it had acknowledged negligence in a conference all with them.

When I asked the Texas attorney general's office for its reaction to BP's denial, spokesman Jerry Strickland stood by the account detailed in the letter:

BP is apparently disavowing its acknowledgment that certain evidence about the Deepwater Horizon explosion would be revealed—and that evidence would render the Oil Pollution Act's liability cap inapplicable—just as they have backed away from their assurances that Texas would receive the $25 million oil spill response grants that every other Gulf State received. And because BP continues to say one thing and apparently mean another, questions about their statements' real meaning—which evidence, parties and conduct they were referring to—should be directed to BP.

The response and the letter indicate that the initial benefit-of-the-doubt that Texas Gov. Rick Perry extended to BP—when he warned that the spill was "just an act of God"—may have dissipated, especially after BP denied the state's request for a $25 million cleanup grant.

by Stephen Engelberg

For the past several decades, there has been an informal understanding between the reporters who uncovered newsworthy secrets and the government intelligence agencies, which tried to keep them from public view.

We would tell senior officials what we'd learned. And they would point out any unforeseen consequences that might arise from publication, such as the death of an American informant. Ultimately, the call on what appeared rested with editors. But it was a decision informed by more than our own guesswork.

The release of more than 75,000 classified documents by WikiLeaks this week makes that arrangement seem as quaint as vinyl records and typewriters. Julian Assange, the organization's leader and avowed opponent of the war in Afghanistan, told Amy Goodman, host of the radio program Democracy Now, that he saw no reason for reporters to take such precautions. (Update: Democracy Now is also broadcast on TV.)

"We don't see, in the case of a story where an organization has engaged in some kind of abusive conduct and that story is being revealed, that it has a right to know the story before the public, a right to know the story before the victims, because we know that what happens in practice is that that is just extra lead time to spin the story," Assange told Democracy Now.

The New York Times, one of three global news organizations given early access to the documents, followed its customary practice, and before it published anything approached the administration for comment. Bill Keller, the paper's executive editor, told me in an e-mail that the White House ultimately answered three of its questions in writing. He said those statements were also provided to The Guardian of Britain and Der Spiegal of Germany, the other two publications.

According to Keller, the White House also asked The Times to pass a message to WikiLeaks requesting that it withhold from release anything "that would endanger lives."

"We pointed out that we were doubtful of our leverage with WikiLeaks," Keller wrote. "But we did pass the message on."

Wikileaks has said it is reviewing an additional 15,000 documents subject to what it described as "a harm minimization process demanded by our source." It said "these reports will be released, with occasional redactions, and eventually, in full, as the security situation in Afghanistan permits."

Several publications pointed out Thursday that the 75,000 documents WikiLeaks has already put online makes it possible to identify Afghans who have cooperated with Western forces. The New York Times reported it had found "dozens" of instances in which informants, potential defectors and others could be unmasked.

It is entirely possible that some of these people will be killed as a result of the publication of these once-secret documents. In Iraq and Afghanistan, even the suspicion of collaboration with American forces has triggered executions.

It has always been difficult to find a balance between the demands of security and robust journalism. Senior intelligence officials were never comfortable with the notion that the press had a right to overrule their judgment of what should be kept secret. For their part, reporters worried that officials would exaggerate the dangers of publication to block embarrassing stories.

When I was a national security reporter, I agreed several times to delay publication of a story or omit certain details. Once, I delayed an article disclosing that Jordanian intelligence had planted an operative inside a Palestinian terrorist group.

Earlier this month, The Washington Post agreed to withhold certain details from a searchable database that included the locations of thousands of facilities performing top secret work. "One government body objected to certain data points on the site and explained why; we removed those items," the Post told its readers, adding that it did not heed the complaints of another agency that "objected that the entire Web site could pose a national security risk but declined to offer specific comments."

The ferment over WikiLeaks brings the government and journalists closer to confronting a question neither side really wants to join: Is there anything more society could do, or should do, to prevent the release of properly secret information?

Suspicions have been deepened whenever the government declassified large quantities of documents and it became clear that the "secret" stamp was frequently wielded to conceal mistakes and misconduct, not information sensitive to national security.

There have been some notable clashes between the press and government over secrecy. In 2005, The New York Times brushed aside protests from the Bush administration and revealed that the National Security Agency had been intercepting communications involving American citizens without court approval. The Bush administration argued that the program was legal and an essential weapon in the war on terrorism. Times editors pushed ahead, even after being told they would have "blood" on their hands if there were another terrorism attack against Americans. Public reaction to the Times revelation ranged from praise for uncovering the program to suggestions that Times editors be tried for treason.

Ultimately, the administration did nothing.

The issue of how the press should handle nationally significant government documents was joined in the 1971 Pentagon Papers case when the Nixon administration attempted to prevent The Times and Washington Post from continuing publication of a secret history of the Vietnam war. By a 6-3 vote, the Supreme Court held that such prior restraint violated the First Amendment.

But four justices raised the possibility that courts could apply a 1950 provision of the Espionage Act that, while it didn't call for blocking publication in advance, made news organizations criminally liable for publishing secrets derived from communications intercepts or code-breaking. This law, passed at the outset of the Cold War, is routinely violated but has never been enforced. It is notable because it focuses on publication. Every other part of the Espionage Act, which originally passed in 1917, focuses on punishing the individuals who pass "information relating to the national defense," to a "foreign government."

It was clear to me in my years covering national security for The New York Times (1985-1990) that neither side really wanted to test the constitutionality of this statute. A significant percentage of the government's classified documents include material derived from eavesdropping by the National Security Agency. The Bush administration could easily have charged the Times with a criminal violation in 2005 over its revelations about an NSA eavesdropping program; it chose not to do so.

The WikiLeaks episode illustrates how much has changed in just a few years. Government officials hoping to leak classified material once had to make contact with a reporter, build trust and physically carry documents out of their offices to a safe location. An editor would then study the material and decide whether it was newsworthy.

Now, the aspiring leaker need only find a way to bypass the government's security procedures and zip an e-mail to a secure server. As the Washington Post series documents, the number of people with security clearances is exploding. Future leaks are inevitable.

It does not appear that many of the Afghanistan war documents posted this week derive from electronic intercepts. But someday soon, something will find its way on the Web that precisely fits the 1950 act. At that moment, whoever is president will face some very uncomfortable choices.

by Marcus Stern

The Obama administration, anticipating that Congress might not pass comprehensive immigration reform this year, is considering ways it could act without congressional approval to achieve many of the objectives of the initiative, including giving permanent resident status, or green cards, to large numbers of people in the country illegally.

The ideas were outlined in an unusually frank draft memo prepared for Alejandro N. Mayorkas, director of the federal agency that handles immigration benefits, U.S. Citizen and Immigration Services (USCIS). The memo lists ways the government could grant permanent resident status to tens of thousands of people and delay the deportation of others, potentially indefinitely.

"In the absence of Comprehensive Immigration Reform, CIS can extend benefits and/or protections to many individuals and groups by issuing new guidance and regulations," said the memo, which was prepared by four senior officials from different branches of USCIS.

The 11-page document was made public Thursday by Sen. Chuck Grassley, R-Iowa, who with six other senators wrote to Obama more than a month ago, asking for his assurance that rumors that some sort of reprieve was in the works for millions of illegal immigrants weren't true.

"The administration has failed to reassure us that the information we were hearing was inaccurate," Grassley said in a statement to ProPublica Thursday night. "This memo gives credence to our concerns that the administration will go to great lengths to circumvent Congress and unilaterally execute a back door amnesty plan."

The memo's release is certain to put the administration on the defensive with opponents of "comprehensive immigration reform" -- Washington code for putting many of the estimated 12 million people in the country illegally on a potential path to citizenship. It is also likely to make immigration an even hotter topic in this year's congressional elections, which have already been roiled by Arizona's controversial attempt to use state and local police to enforce federal immigration laws.

Christopher Bentley, a USCIS spokesman, said last night that the agency would not comment on details of the memo, which he described as an internal draft that "should not be equated with official action or policy of the Department...We continue to maintain that comprehensive bipartisan legislation, coupled with smart, effective enforcement, is the only solution to our nation's immigration challenges."

Bentley said that internal memos help the agency "do the thinking that leads to important changes; some of them are adopted and others are rejected" and that "nobody should mistake deliberation and exchange of ideas for final decisions."

"To be clear," he said in an e-mail, the Obama administration "will not grant deferred action or humanitarian parole to the nation's entire illegal immigrant population."

One of the memo's most controversial suggestions is wider use of "deferred action," the agency's discretion to indefinitely delay the deportation of otherwise deportable non-citizens. "This would permit individuals for whom relief may become available in the future to live and work in the U.S. without fear of removal," the memo said.

The memo acknowledges that granting deferred action to an unrestricted number of people "would likely be controversial, not to mention expensive." Instead, it suggests that this option be used for particular groups, such as the approximately 50,000 young people who would be allowed to stay in the country if Congress passed the Dream Act. That bill would provide a potential path to citizenship for qualifying young people who complete a college degree or two years of military service.

The memo also says that standards for "extreme hardship" cases could be eased so "many more spouses, sons and daughters of U.S. citizens and lawful permanent residents" could seek relief without fearing deportation.

In what would be a reversal of a position held by the agency's Office of General Counsel under previous administrations, the memo suggests granting green cards to large numbers of people currently in the country under Temporary Protected Status. That status typically is used to forestall deportation proceedings for large groups of undocumented foreign nationals when it would cause them hardship, such as sending them home in the wake of a major earthquake or hurricane or during a civil war.

Supporters of comprehensive immigration reform are certain to welcome any effort by the Obama administration to unilaterally open pathways to citizenship for many currently in the country illegally. But the draft is also sure to outrage immigration-restriction groups.

"The memo proposes 18 different ways for the Obama administration to essentially eliminate our borders through regulatory fiat and in clear violation of the letter and the spirit of U.S. immigration laws, which Obama swore an oath to faithfully execute," said Rosemary Jenks, director of government relations for NumbersUSA, an organization that lobbies for tighter immigration laws and practices.

by Marian Wang

Citigroup has agreed to pay the SEC $75 million to settle charges that the bank hid exposure to more than $40 billion in subprime CDOs. (That works out to roughly $1 fine for every $500 worth of hidden exposure.) Read the full SEC complaint.

In what the New York Times called “an unusual move,” the SEC also charged one current and one former Citi executive for making the misstatements. Former CFO Gary Crittenden will pay $100,000 and Arthur Tildesley—formerly the head of investor relations—will pay $80,000. Neither Citi nor the execs admitted to any wrongdoing. 

According to the SEC enforcement director Robert Khuzami, Citigroup had boasted in 2007 “of superior risk management skills in reducing its subprime exposure to approximately $13 billion,” when in fact, “billions more in CDO and other subprime exposure sat on its books undisclosed to investors.”

“We are pleased that we have reached agreement with the SEC to put this matter concerning certain 2007 disclosures behind us, and that the SEC is not charging Citi or any individual with intentional or reckless misconduct," said Citigroup spokeswoman Shannon Bell.

As we have noted in our bailout tracker, Citi's subprime losses have been massive, and resulted in multiple taxpayer-financed bailouts—$45 billion overall.

Citi execs have in the past said they were "deeply sorry" for ... not predicting the market collapse. 

We’ve reported on some of Citi’s specific CDO dealings with a hedge fund called Magnetar, and some of the disclosure questions about those deals as well as others. For more on trouble Citi and others could be facing, check out our bank investigations cheat sheet.

by Marian Wang

BP executives have repeatedly denied accusations that the disaster in the Gulf was a result of company negligence, but a letter to BP from Texas officials suggest that some within BP don’t entirely agree.

In a letter sent to BP last week, Texas Gov. Rick Perry and Attorney General Greg Abbot described a conversation in which BP lawyer Jack Lynch said that gross negligence was a possibility.

From the letter:

During a conference call with Gulf Coast attorneys general, BP General Counsel Jack Lynch acknowledged that gross negligence would be revealed as a cause of the explosion that led to the oil spill.

If you’re wondering whether the Texas governor just has it in for BP, remember that this is the same official who spoke at the Chamber of Commerce in May and warned against jumping to conclusions, “a knee-jerk reaction” to the spill, and suggested that the spill was “just an act of God.”

A BP spokesman told The Houston Chronicle — where we first noticed the questions about the letter — that the Texas governor and attorney general were wrong in the letter, and that “during the conference call, neither Jack Lynch nor any other BP representative stated that gross negligence would be revealed as the cause of [the] Deepwater Horizon tragedy.”

A finding of negligence would cost BP quite a bit. As we've noted, if gross negligence is found, the company could face penalties four times larger for violations of the Clean Water Act. It would also lose the argument for having its two well co-owners, Anadarko and MOEX Offshore, help foot the cleanup bill.

We've asked the Texas attorney general's office for details about that conference call in order to check Lynch's comments with other Gulf states, and will update when we hear back.

by Abrahm Lustgarten

Tucked inside the Senate bill aimed at cracking down on oil drillers after the Gulf spill is a long-sought measure to protect groundwater from natural gas drilling.

The bill, called The Clean Energy Jobs and Oil Company Accountability Act, would require that drilling companies make public a complete list of chemicals injected underground in proprietary formulas to break up rock deep underground and extract natural gas, a process called hydraulic fracturing.

It would not, however, reverse the exemption that prohibits the Environmental Protection Agency from regulating the fracturing process like other forms of underground injection, another important regulatory change that was initially proposed in House and Senate bills last June along with the chemical disclosure.

That bill, called the Frac Act, was sponsored by Sen. Bob Casey, D-Pa., who pushed for its inclusion in the accountability bill now being considered.

"Proper regulation is another essential element in protecting drinking water and public health. That is a battle that we still need to fight," Casey told ProPublica in an e-mail. But he emphasized that disclosing the chemical names "is an important step toward informing the public and building accountability for oil and gas companies."

A push for disclosure and stricter regulation of the fracturing process began in earnest last year after a series of articles by ProPublica reported more than a thousand cases of ground and surface water contamination in drilling areas where the process was being used. The articles examined drilling records in more than seven states, and found both a consistent pattern of water contamination in drilling areas, and a gap in scientific knowledge about the way hydraulic fracturing affects underground layers of rock and aquifers.

Problems were severe in Casey's home state, where fast-paced development of the Marcellus Shale natural gas deposit quickly led to dozens of reports of drinking water well contamination in places where hydraulic fracturing had been employed. Residents reported flammable tap water, and state investigations found that methane had seeped into water supplies underground as a result of the drilling activity.

Investigating the cause of such incidents has been difficult in part because the EPA does not have the jurisdiction to regulate fracturing the way it does other injection processes, and because the chemical makeup of the fracturing fluids has been guarded as a trade secret.

Several states, including New York, Colorado and Wyoming, have recently passed disclosure laws of their own, and industry representatives have begun to support the notion. But the language of the Senate bill is the most specific, and would apply to all of the states where oil and gas is produced.

The disclosure proposed today would still allow companies to withhold the exact recipes they use, meaning they wouldn't have to disclose the concentrations to the public. But they would -- in case of emergencies -- be required to share that information on a confidential basis with doctors and hospitals responding to an accident.

It's not clear how far the bill will get in the face of Republican opposition. Sen. Harry Reid, D-Nev., who added the disclosure component to the accountability bill, has said he hoped to bring the bill to a vote next week. Even if it passes, it will need to be reconciled with a House version that does not include the fracturing disclosure language.

Update: Politico notes that Reid may have added the disclosure language as a note to environmentalists, who have been upset that the Senate has moved away from a bill on global warming.

by Marian Wang

For the families of fallen soldiers, funds from their loved ones’ life insurance policies may provide little comfort for their loss, but it just adds insult to injury to learn that insurance companies have set the system up so they make a profit by holding onto payouts, using the funds to make more money, and pocketing most of the earnings.

According to an excellent investigation published by Bloomberg yesterday, that’s exactly what happens with “retained-asset accounts,” which have become “standard operating procedure” in the life insurance industry.

With these “retained-asset accounts,” instead of writing a check for a lump sum, insurers send beneficiaries something that resembles a checkbook and assures them that the money is in a secure, interest-earning account.

In reality, according to Bloomberg, the insurer holds onto the funds and uses them to earn investment income. Prudential, for instance, earned a 4.8 percent return on such funds in 2008, while paying beneficiaries far less interest. Here’s Bloomberg:

Both MetLife, which handles insurance for nonmilitary federal employees, and Prudential paid 0.5 percent interest in July to survivors of government workers and soldiers. That’s less than half of the rate available at some banks with accounts insured by the FDIC up to $250,000.

What’s more, the “checks” aren’t always accepted because the process for retailers to receive reimbursement is more complicated—the money isn’t pulled directly from a bank account because it needs to first be transferred from the insurer.

Though some states are looking into the matter, few states have rules on retained-asset accounts, and the Office of Veterans Affairs—which pays Prudential for life insurance for soldiers—has allowed the practice, according to Bloomberg.

Prudential, however, said it made the proper disclosures and argued that the retained-asset accounts are helpful for families.

“For some families, the account is the difference between earning interest on a large amount of money and letting it sit idle,” spokesman Bob DeFillippo told Bloomberg.

Government workers should also beware. The practice extends beyond the military, according to Bloomberg.

“They’ve kind of created a sort of shadow banking system,” said David Evans, author of the Bloomberg piece, in an interview available online. “There are now a million of these accounts that hold $28 billion of money that would’ve been paid out in the old days to survivors, and is now being held as a profit center for the life insurers.”

by Marian Wang

It’s Day 100 of the BP oil disaster in the Gulf, and if you just read the New York Times and Washington Post headlines this morning, you might be feeling pretty hopeful that soon enough, you won’t have to think about oil spills for a while.

Not so fast. On Tuesday, another spill was detected in the Gulf—the result of a boat's colliding with an out-of-use wellhead in Barataria Bay. NBC reported that it was small in size, but near a marshy and ecologically sensitive area of Louisiana.

Officials said on Tuesday that the spill would likely be contained within the day, but when I called the Coast Guard this afternoon, I was told the well was still spewing oil and gas.

“Well control did arrive on the scene and are in the process of shutting that well right now,” Coast Guard Petty Officer Tom Atkeson told me. “I do not have an exact figure on the amount of gallons that have been spilled. It looks like most of it is natural gas.”

The protective measures that we’re now all-too-familiar with have also been put in place for this spill—safety zones around the site, and nearly 11,000 feet of boom.

Up in Michigan, The Detroit News reports that workers are still fighting what “could rank as the Midwest’s worst oil spill.” More than 800,000 gallons of oil spilled from a ruptured underground pipe and entered the Kalamazoo River. Residents had detected the smell of crude on Sunday evening, but no one knows how long the leak was happening, and there are still questions of whether the flow from the pipeline has been completely shut off.

Canada’s Enbridge pipeline company has pledged to clean up the spill, but told reporters it will take months.

Benzene—a carcinogenic constituent of crude oil also detected in the Gulf—has been detected in the air. The EPA said data haven't shown levels that are “immediately dangerous to human health and life,” but added, “That’s not to say we are confident that those levels are acceptable for long-term exposure.”

As many as 30 families have been relocated, and the cause is being investigated, according to the News.

Michigan’s governor, Jennifer Granholm, has called the response to the spill “anemic.” (And yes—there are photos, if you haven’t had your fill of oil-covered birds.)

This particular pipeline typically carries “about 8 million gallons of oil per day” from Indiana to Ontario, The Associated Press reported. With plans already in the works for another pipeline that would stretch from Canada to the Gulf, perhaps the EPA was wise—given our recent troubles—to slow down the approval process for this project just a tad.

by Marian Wang

In a memo released on Tuesday, a Senate subcommittee disclosed that it has “obtained information suggesting that 4,900 to 6,600 graves may be unmarked, improperly marked, or mislabeled” on the maps at the historic Arlington National Cemetery. These problems, according to the memo, are “far more extensive than previously acknowledged.”

The Subcommittee on Contracting Oversight gave kudos to Salon.com for a series of articles about the cemetery’s mismanagement, and to whistleblowers whose concerns went largely ignored for years.

The waste and contract mismanagement at Arlington, the memo pointed out, started years ago:

More than ten years ago, the Army began the development of a new system to automate the management of burial operations at Arlington National Cemetery. Documents and information obtained by the Subcommittee show that a series of improper actions and errors have wasted millions of dollars and delayed implementation of a functioning system by years.

Despite spending between $5.5 million and $8 million to develop a better system, “Arlington National Cemetery still does not have a system that can accurately track graves and manage burial operations,” the memo reads.

There are 330,000 grave sites at the cemetery--a burial place of military veterans, Supreme Court justices, U.S. presidents, former slaves and Civil War soldiers. The cemetery is managed by the U.S. Army.

In a hearing last month, Army Secretary John McHugh testified that the Army officials overseeing the cemetery were ignorant of the problems, Salon noted.

According to The Washington Post, the Army has known about these problems for almost 20 years but has been unable to solve them. The Senate subcommittee also found that the Army—which had divided oversight of the cemetery among several Army organizations over the years—had failed to conduct “even the most basic oversight.”

The subcommittee has subpoenaed some cemetery officials, and they are scheduled to testify on Thursday.

by Quadia Muhammad

Earlier this month, Sasha Chavkin reported that although BP has repeatedly promised to “make things right,” the company has paid out less than a third of claims to date.

In this week’s podcast, Chavkin breaks down the $20 billion BP claims process, discusses the experiences of some Gulf-region claimants and explains we how are reaching out to readers to help measure the effectiveness of the claims process.

Chavkin is working with ProPublica’s director of online engagement, Amanda Michel, to develop the project.  If you are in the Gulf and are filing a claim with BP ProPublica wants to hear from you. Tell us your experience with the BP claims process here.

Stories related to this podcast:
• Mental Health Claims From Oil Spill Probably Won’t Be Paid
• New BP Data Shows Payments on Less Than a Third of Claims
• For Claims of Bodily Injury, No Payments from BP Yet 
• Many Spill Claims Remain Unpaid as BP Debates Escrow Account

by Sasha Chavkin

This article was corrected on July 29, 2010.

The BP oil spill has caused massive economic damage to people along the Gulf Coast. To compensate these losses, BP has set up a huge, multistate operation to handle the more than 100,000 claims that it has received. For people who have filed claims, or are thinking of doing so in the future, this complex system has raised a lot of questions. We answer some of the most important questions about the claims systems below. Got other questions? Send them to Sasha Chavkin. Share details of your experience with ProPublica’s reporters using this simple form – we’re beginning to examine the claims process.

Who is managing the claims system?

So far, the claims system has been managed by BP. The company has hired contractors to handle the claims, and its primary contractor is the claims management firm ESIS, Inc. ESIS has two principal subcontractors: Worley Catastrophe Response, which is in charge of adjusting, and Innovation First Notice, which handles claims intake.

In August, the claims system will be taken over by Kenneth Feinberg, an independent administrator appointed by President Barack Obama. BP will pay Feinberg’s salary, but he reports neither to BP nor to the government. Feinberg will have wide discretion in setting the rules to determine who is eligible for payments. The money for the new system, known as the Gulf Coast Claims Facility, will be drawn from the $20 billion escrow account that BP has agreed to set aside to cover claims and other expenses.

How do I file a claim?

There are three ways you can file a claim. You can call BP’s toll-free number (1-800-440-0858), you can file online through BP’s online submission form, or you can go in person to one of BP’s claims offices that are set up across the Gulf region. You can find the location of the closest office here.

What kinds of damages can I get compensation for?

Kenneth Feinberg said that he has written a draft protocol for determining eligibility for claims, but it has not yet been completed or published. He said that his baseline will be federal and state liability law: if you would win a lawsuit against BP at either level, then you’re eligible. Feinberg said that he would sometimes go beyond this legal baseline in the interests of justice and fairness, but did not specify in what areas.

Currently, as an individual or a business, you are eligible for compensation for a number of different types of damage: property damage, net loss of profits and earning capacity, natural resource damage, removal and cleanup costs, loss of subsistence for fishermen and others who catch their food in the Gulf, and bodily injury. If you have experienced more than one type of damage, you should file one claim that includes all of the areas where you are seeking compensation, in order to avoid confusion and bureaucratic delays.

Government entities, like counties or states, are also entitled to compensation for the cost of increased public services and loss of government revenue. Government claims will be handled by BP directly rather than by Feinberg.

To date, BP has not made any payments for bodily injury claims or government requests for additional mental health services. Compensation for most damages is defined by the Oil Pollution Act, a 1990 law that requires BP to pay for the "removal costs and damages resulting from an incident,” but the act does not cover health-related damages. Feinberg has said that he will pay personal injury claims but probably will not pay mental health claims. BP said that it is still determining its policy on government requests for mental health services.

It is also unclear how claims for indirect damages will be handled, such as loss of property value not directly caused by oil damage, or declines in rentals in beachfront hotels where oil never reached the beach. If you’ve filed a claim and haven’t gotten a clear answer on whether your damages will be covered, you call tell us about your experience here.

What will change when Kenneth Feinberg takes over the claims process from BP?

Feinberg has not yet provided official guidelines of how he will administer the claims fund, or set out any changes on policies such as requirements for documentation or types of damages that will be compensated. He has promised quicker and more substantial emergency payments, which he says will include six-month lump sum payments to ease economic hardship. Feinberg has also testified before a congressional committee that he will reduce the processing time to write checks for emergency payments to within two days of the approval of the claim. He will keep much of the same system – such as the claims offices and some of the contractors – that BP has used for responding to claims to date.

Has BP paid out all of the claims it has received?

As of July 29, BP’s claims statistics indicate that it has made payments on just over 37,000 of 135,000 claims, or 28 percent of the total. Here is the breakdown of the status of claims submitted to BP:

Total Claims 135,000 100% Claims With at Least One Payment 37,200 28% Awaiting Documentation for First Payment 57,300 42% Having Contact Difficulty 12,200 9% Withdrawn, Erroneous or Duplicate 4,700 3% In Process, Evaluating for Payment 23,600 17%

The largest single category is people who are “Awaiting Documentation for First Payment,” which means that BP found that their claims were inadequately documented and requested that they provide further proof of damages before sending a check. Experts tell us that this proportion (42 percent of total claims) is not unusual for the early stages of a massive claims process, but it shows that providing documentation that is acceptable to BP has been a significant challenge for claimants so far. Providing documents has been a particular challenge for informal workers like deckhands and day laborers who are often paid in cash. If you’ve had this problem, you can tell us about your experience by filling out this simple form.

What documentation will I need to provide for my claim to be approved?

Currently, BP’s website describes the types of documentation that it requires for claims to be approved.

Claims for loss of income or net profits can be documented with tax records, trip tickets, wage loss statements, deposit slips, boat registrations or copies of your current fishing license. Claims that may require additional documentation are property damage, loss of rental income, economic loss for businesses, and bodily injury. All claims require valid photo ID to be approved.

As of July 29, 42 percent of claims were determined by BP to have insufficient documentation, and the company sent letters to these claimants stating that they needed to provide further evidence of the damage before they could get paid. Kenneth Feinberg will also require claims to be documented, but he testified to a congressional committee that he will “bend over backward to help anybody who claims lost wages or lost business in an all-cash business.” In these cases, Feinberg said he would also accept alternate documents, such as letters from a boat captain, priest or town mayor.

Do I need a lawyer to file a claim?

No. Under both BP and Kenneth Feinberg, the claims process does not require an attorney. However, you are allowed to obtain legal representation if you wish, and BP says that it will treat claimants who are represented by an attorney the same as those who are not.

Feinberg said that he would also set up a pro bono program to provide free legal advice to people who are making claims, although this program has not yet started. There will also be staff in the claims offices set up by BP around the Gulf area who will be available to help prepare your claim.

How long will it take for my claim to be paid?

As of July 29, BP’s claims statistics showed an average wait of five days from “claim to paid” for individuals who have gotten checks, and nine days from claim to check for businesses.

However, this refers only to the people whose claims have been approved – only 28 percent of total claimants. BP has determined that about half of claimants (51 percent) need to provide either better documentation of their claim or additional contact information in order for their payment to be approved. Data from the claims process and statements on BP’s website indicate that requests for more documentation are the most common reason that claims payments are delayed..

Does filing a claim mean giving up my right to sue for damages?

That depends on the type of claim that you file.

The monthly emergency payments that BP has been making do not require claimants to give up their right to sue. If you’ve been getting monthly payments for lost income, you can still file a claim or a lawsuit for additional or future losses, although the payments you’ve received will be counted in considering how much BP owes you. Kenneth Feinberg has said that he will also distribute six-month emergency payments in advance, which will not affect your right to sue either.

However, claims for a long-term settlement – payments that include projected future damages caused by the spill and are meant to cover all of your losses – require that you give up your chance to sue if you accept the money. This type of claim will not be considered until three months after the well is capped, and will erase all of BP’s liability to you when it is paid. You can still file a lawsuit if you submit a long-term settlement claim but aren’t satisfied with the offer.

What can I do if I don’t think the payment that I’m offered is fair?

You have the right to appeal decisions made by administrator Kenneth Feinberg, or to seek alternative remedies to the claims process if you are dissatisfied with its results entirely.

Within the claims process, you can appeal Feinberg’s decisions to a three-member panel that will be available to review claims that are denied and payments that you consider insufficient.

Outside the claims process, people seeking damages that are covered under the Oil Pollution Act – property damage, economic losses and cleanup costs – may appeal decisions by Feinberg to the Oil Spill Liability Trust Fund. The Trust Fund contains $1 billion and is administered by the Coast Guard. If you’re dissatisfied with both Feinberg and the Trust Fund, you still retain the right to sue in court.

Claims in areas that aren’t covered by the Oil Pollution Act, such as bodily injury, cannot appeal to the Trust Fund for compensation. These claimants still can file a lawsuit and seek remedy in court if they aren’t satisfied with the offer from Feinberg.

Does the $20 billion fund cap the damages that BP will pay out?

No. The $20 billion fund does not put a cap on how much BP will pay out in damages. BP says that it will make payments from the fund as awarded by Kenneth Feinberg through the claims process, as ruled by the courts or as separately agreed upon by the company. BP has said that it will continue to make payments even if the $20 billion runs out.

This means that the fund will be used to pay for both the claims process and separate lawsuits and settlements – but that no one should lose the chance to get compensated if damages turn out to be worth more than $20 billion. The fund will operate for three years and you can file a claim at any point during that period.

Who is Kenneth Feinberg and what is his role as the fund’s administrator?

Kenneth Feinberg is the lawyer selected by President Obama to administer the Gulf Coast Claims Facility, which draws from the $20 billion fund created by BP to compensate damages from the oil spill. Feinberg will administer the fund independently of the government or BP, and he has broad authority to set the rules for who will be paid by the fund and how much they will receive.

Feinberg has a long record of administering funds for compensation of mass damages. He is best known for administering the 9/11 Fund, which compensated the survivors of those killed on 9/11 and those who were injured by the attacks. He has also supervised compensation funds for the Virginia Tech school massacre and Vietnam veterans exposed to Agent Orange, and served as Treasury Department’s overseer of executive pay in companies that received money from the bailout.

Correction (7/29/2010): This article originally said that the $20 billion compensation fund created by BP was established to cover claims and known as the Gulf Coast Claims Facility . The fund in fact covers both claims and other expenses such as court judgments, and the Gulf Coast Claims Facility draws from the compensation fund.

by Amanda Michel and Sasha Chavkin

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by Amanda Michel and Sasha Chavkin

Lectores, necesitamos su ayuda. Es hora de examinar la operación masiva de las demandas establecida por BP para los daños del derramamiento de crudo y gas en el Golfo de México.

La fuga petrolera ha sido tapada. Se han registrado más de 100.000 demandas. Hasta ahora, BP ha pagado menos que un tercio de las demandas que han recibido, y gastado un poco más de $200 millones, o sea cerca de 1 por ciento de los $20 mil millones del fondo en fideicomiso para pagar futuros daños. En menos de dos semanas, un administrador de demandas, independiente de BP y designado por presidente Barack Obama -- Kenneth Feinberg -- asumirá el control sobre el proceso de las demandas de BP.

Podríamos tomar BP en su palabra que pagará a todas las demandas “legítimas”, y confiarnos en los aseguramientos de la administración que ellos cumplirán con la gente del Golfo de México. Pensamos que es mejor enfocar la luz en el proceso.

Aquí es a donde usted figura.

Si usted ha registrado una demanda con BP, comparta por favor los detalles de su experiencia con los reporteros de ProPublica de esta manera.  (El formulario está en inglés) Puede ser que uno de nuestros reporteros se contacte con usted por el teléfono, y lo haremos fácil para que usted comparta documentos y expedientes con nuestra redacción.

Si usted no ha registrado una demanda, aún usted puede ayudar a ProPublica para encontrar a demandantes tras publicando este publicar en su cuenta Twitter, Facebook u otros registros locales. 

by Amanda Michel and Sasha Chavkin

Readers, we need your help. It’s time to examine the massive claims operation set up by BP for damages from the Gulf oil spill.

The gushing pipe has been capped. More than 100,000 claims have been filed. So far, BP has paid less than a third of the claims it has received, and has spent about $250 million, a little over 1 percent of the $20 billion that it set aside in an escrow account to pay damages. In less than two weeks, an independent claims administrator appointed by President Barack Obama -- Kenneth Feinberg -- will take over the claims process from BP.

We could take BP at its word that it will pay all “legitimate” claims, and trust the administration’s assurances that the people of the Gulf will be made whole.  We think it’s better to shine some sunlight on the process.  

That’s where you come in.

If you’ve filed a claim with BP, please share details of your experience with ProPublica’s reporters using this form. (This post is also available in Spanish and Vietnamese.) A reporter may follow up with you by phone, and we’ll make it easy for you to share documents and records with our newsroom.

If you haven’t filed a claim, you can help ProPublica find claimants by doing your own outreach – tweet this, post it to Facebook, send it out to a local listserv …

BP’s data show that it has returned more than half of submitted claims because they “lack enough information for BP to make a payment.”  In most of those cases, it has told people that they have to provide more documentation to prove that their claim is legitimate.

News reports have also spotlighted problems like translation difficulties between BP adjusters and Vietnamese fishermen working off the Louisiana coast. Some claims offices are hard to find. Bartenders, deckhands and other workers who earn their salaries in hard cash can’t easily document their earnings. As we have reported, repeated changes made to procedures for filing county claims have frustrated county officials.

These problems are real, but not easily put into perspective. When are people being told they need to send more documents?  Just how serious -- or trivial -- are the procedural  changes? Who has been paid, and who hasn’t?

Getting a handle on an operation this big and complex requires talking to more than a handful of people.  We want to cast a wide net to try to figure out which parts of the claims system are working and which ones aren’t, so we can add some accountability to the process.

If you’ve filed a claim with BP, share details with ProPublica’s reporters using this form.

by Amanda Michel and Sasha Chavkin

Xin các bạn đọc giúp chúng tôi.

Nếu bạn đã nộp đơn khiếu nại thiệt hại về sự dầu tràn của BP, xin vui lòng chia sẻ kinh nghiệm của bạn với các phóng viên của ProPublica bằng cách điền vào mẫu giấy này (bản tiếng Anh) Một phóng viên sẽ tiêp xúc với bạn bằng điện thoại, và mọi chia sẻ của bạn sẽ dễ dàng được chuyển đến phòng báo chí của chúng tôi.

Nếu bạn không nộp đơn khiếu nại, các bạn có thể gíúp ProPublica phổ biến lời yêu cầu này đến những nguời khiếu nại trên mạng (internet), trên Facebook, hay gửi đến các danh sách địa phương của bạn, v.v.

by Marian Wang

BP announced today that it suffered what The Guardian is calling “one of the largest losses in British corporate history” — a $17 billion shortfall in the second quarter of 2010. It also announced a number of company shake-ups, including a plan to sell $30 billion in assets and the resignation of CEO Tony Hayward, which has finally been confirmed after much speculation.

But there’s a silver lining for the company.

The $17 billion loss is thanks to the company’s decision to set aside $32 billion to pay for the $3 billion in cleanup costs incurred to date, and $29 billion for future costs.  (That includes the $20 billion escrow fund for damages that President Barack Obama asked BP to set aside.)

MSNBC, however, pointed out that BP will be deducting this $32 billion from its tax bill, “reducing future contributions to U.S. tax coffers by almost $10 billion.” BP’s tax bill in the U.K. will also be reduced, the company told MSNBC.

According to the Financial Times, the tax deductions represent “a drop of more than a quarter in BP’s tax payments.” 

BP’s spokesman Tony Odone told MSNBC that the tax offsets are “just normal practice.”

“We will pay less in tax because we are earning less, as you would as an individual if you were earning less,” Odone told MSNBC. “We are going by U.S. laws, we’re following the accounting laws of the country. We are a business and we have shareholders we are responsible to.”

Normal practice or not, whatever BP saves in taxes is what the government will have to make up otherwise. And then there’s the matter of Hayward and his departure. His resignation goes into effect Oct. 1, but he won’t be leaving empty-handed:

Under the terms of his contract, BP is giving him a year’s salary of $1.6 million, plus benefits, and according to the BBC, he’ll also collect an immediate $930,000 in annual pension. He’ll also retain shares of BP that could eventually be worth millions more.  

BP said it plans to nominate Hayward for a position with TNK-BP, the company’s joint venture in Russia. He will be replaced by BP exec Robert Dudley, an American, who will become the company’s “first ever non-British chief executive,” according to The Associated Press.

by Sasha Chavkin

BP's $20 billion fund to compensate those hurt by the Gulf oil spill will probably turn down one controversial class of claims: those for mental health problems.

In little-noted testimony before the House Judiciary Committee on July 21, Kenneth Feinberg, the independent "claims czar" who will decide who gets compensated, said the fund was not likely to pay damages for mental illness and distress alleged to be caused by the spill.

"If you start compensating purely mental anguish without a physical injury -- anxiety, stress -- we'll be getting millions of claims from people watching television," Feinberg said. "You have to draw the line somewhere. I think it would be highly unlikely that we would compensate mental damage, alleged damage, without a signature physical injury as well."

Feinberg's policy will affect individuals and businesses with claims against BP, but not claims by the government. Claims by state and local governments for the costs of additional services will not be evaluated by Feinberg, and are handled directly by BP.

As we've reported, the Louisiana health department has warned of a looming mental health crisis in communities affected by the oil spill and is pressing BP to pay for its costs. On July 9, health commissioner Alan Levine wrote to U.S. Health and Human Services Secretary Kathleen Sebelius that state counseling teams were encountering "increases in anxiety, depression, stress, grief, excessive and earlier drinking and suicide ideation" following the disaster. BP has not yet responded to Louisiana's request that it pay $10 million to cover the costs of emergency mental health services.

BP spokeswoman Patricia Wright said that the calls for funding for mental health services -- which have also been submitted by Mississippi, Alabama and Florida -- have been requests rather than formal claims. She confirmed that the company has not yet responded to the requests.

While Feinberg's standard is separate from BP's policy on requests or possible claims by states, it shows that he is following the guidelines set by liability law. Tort law generally holds that mental health problems must be accompanied by a physical injury to merit compensation, David Owen, a law professor at the University of South Carolina, has told us.

However, Congress could direct Feinberg to expand the type of damages that his fund will cover. When Rep. Sheila Jackson Lee, D- Texas, pointedly asked him at the July 21 hearing if he would cover damages such as mental health if Congress passed a law requiring it, Feinberg replied that he would.

by Marian Wang

Earlier this month, we reported that two weeks before BP’s blowout in the Gulf of Mexico, the company’s refinery in Texas City, Texas, released 538,000 pounds of toxic chemicals into the air. The release, as we noted, went on for 40 days as the company tried to repair a key piece of equipment without stopping production.

According to The Daily News of Galveston, Texas, the state attorney general’s office is now investigating the release and looking closely at whether BP satisfied all reporting requirements.

The case is serious enough that the Texas Commission on Environmental Quality referred the issue directly to the state attorney general, commission spokeswoman Andrea Morrow told the Daily News. This is not standard practice:

Normally, the environmental agency would file an enforcement citation called an agreed order that would outline the company’s violations, associated fines and orders on what processes or equipment needed corrective action. Only if the company disagreed with the TCEQ findings would the case be sent to the attorney general.

Because of the seriousness of the event and a pending attorney general’s lawsuit against BP for environmental violations, the case instead was filed directly with the attorney general Tuesday, Morrow said.

Last year, the Texas attorney general filed a civil suit against BP for “poor operating and maintenance practices” that resulted in 53 separate incidents of excessive emissions. The Texas City refinery is most infamous for a 2005 explosion that killed 15 people, but as we’ve reported, “four more workers have died in various accidents since then, and two chemical releases in 2007 sent more than 130 people to the hospital.”

Continued violations at the refinery—including failure to repair some of the very problems that led to the 2005 blast—prompted the Occupational Safety and Health Administration to fine BP a record $87 million last year. That fine remains unpaid.

If the Texas attorney general finds grounds for another lawsuit over the 40-day toxic release, the charges would be not be rolled into the current litigation, but would be treated instead as a separate case, the Daily News reported.

BP spokesman Michael Marr wouldn’t comment on the litigation to the Daily News, but said, “We have implemented substantial enhancement in safety and environmental performance and reporting of emissions events at the Texas City refinery.”

by Marian Wang

Americans who—like me—weren’t alive when the Pentagon Papers story was first leaked to The New York Times are likely still familiar with the end conclusion: The American people found out what a disaster the Vietnam War had been. And in a landmark case for press freedom, when the federal government tried to stop the Times and The Washington Post from publishing that confidential record of the war and the lead-up to it, the Supreme Court ruled on the side of the press, in favor of “no prior restraint” or censorship from the government.

But some of the details may be hazy, and especially as so many have begun comparing the revelations in the Afghanistan War Logs—released by WikiLeaks and reported out by The New York Times, The Guardian, and Der Speigel—it’s worth revisiting some of that history to better inform our perspective on the present.

So I rang up Neil Sheehan, the former New York Times reporter to whom the Pentagon Papers were first leaked by military analyst and whistleblower Daniel Ellsberg in 1971—stories for which the Times later won the Pulitzer Prize. (Ellsberg, it is worth noting, has also chimed in on the latest leaks. He told The Wall Street Journal that he felt an affinity for the leaker in this case.)

Sheehan proceeded to share—in the brief time we were able to speak—what the Pentagon Papers told us about Vietnam, and what the latest leaks say about Afghanistan. Here’s what he had to say, edited slightly for clarity:

On the War Logs vs. Pentagon Papers comparison:

The Pentagon Papers dealt with more years. From 1944—World War II—through 1968. You had a vast time span. It was an archive of much of the war itself. It was for most of the war and covered the French-IndoChina war. The Pentagon Papers' revelations were of the highest level of decision-making. Decision-making by the president, the secretary of state, secretaries of defense, heads of the CIA, commanding generals. The highest level—and those were the most exciting revelations—the extent to which the government had deliberately deceived the American public about events in Vietnam or deluded themselves.

They came at the end of a long war that divided this country more than any war since the Civil War. This is coming during a war that’s an unpopular war, but the revelations aren’t at that level. As far as I can make out, the WikiLeaks logs cover a number of years. But it’s nitty-gritty stuff. Low-level stuff.

It doesn’t mean it’s not very revelatory. It is. It shows the extent to which the Bush administration abandoned the war in Afghanistan and what repercussions that has had. These young men and women were treated in a shabby fashion. They weren’t given the support they should’ve been given. They didn’t expect to get that support until Obama came in, and it takes time for that shift to happen.

On what the Afghanistan War Logs have added to what we know:

They show how difficult the war in Afghanistan is. It’s a very complicated situation. You’ve got a government in Kabul which is corrupt and untrustworthy. You’ve got Pakistani allies which are not necessarily always your allies. You’ve got a Taliban movement which is resurgent, but also isn’t unified. It has its own factions, but it’s a resilient movement .

The WikiLeaks revelations are very valuable, I think. They show how hard it is going to be to reach the objective the U.S. wants to reach, which is basically pacifying the country. Coming up with a sort of agreement which will pacify the country and end the insurgency. It shows how difficult it is to deal with your own allies.

It gives you a good insight into the war, the kind of war Americans are faced with. It shows the extent to which the Bush administration neglected Afghanistan and wasted resources in Iraq on a war that wasn’t necessary, and ignored a war that was necessary in Afghanistan. The situation has worsened markedly as a result of that neglect.

On the criticism by some who point out that the latest leaks don’t bring to light much new information:

They may not contain a lot of new information, but they get public attention. That’s important, that the American public understand what’s going on. I’m not saying it’s necessary that they quit Afghanistan, but that the public understands the price being paid.

One value from these logs is it shows things are much more difficult on the ground than what you get from high-level briefings where they talk about counterinsurgency and use all these terms. When you get down to nitty-gritty here, these guys are trying to deal with a village that’s divided against itself. You don’t know who to trust, because people in the village don’t know who to trust.

On whether it should come as a surprise that the official picture is rosier than reality:

That’s almost always the case. There’s a lot of pressure to succeed on senior people. They put that on the people below them. It’s self-generated. The Army term is "can-do spirit." There’s the can-do spirit. No general wants to admit he can’t accomplish something, so you’re bound to get a rosier picture.

On how having the documents makes the realities of war more tangible:

In a very important way, these records make the war more tangible. There’s something tangible now. People can understand that.

The New York Times has a picture of the Taliban in a Ford truck given to the Afghan Army by the United States. That happened in Vietnam. We armed the Viet Cong guerrillas. When I first went to Vietnam, a Viet Cong battalion would be lucky to have one machine gun. Within one year, you had two or three per battalion—one per company at least. Their firepower increased enormously. That was from us.

There’s a problem in fighting an insurgency and that is that when you pour resources into a country like that, into a society that has conflict within itself, the side with the most motivation tends to obtain those resources one way or another.

On other differences people should keep in mind:

The American Army in this war is totally different than the Army in Vietnam. The American Army in Afghanistan is an army of volunteers. They’re young men and women who’ve signed up for the military because they think they’ll survive, they’ll be able to get a college education, or they really wanted to be a soldier or Marine.

That wasn’t true in Vietnam. They were drafted or volunteers, and even the volunteers figured they’d eventually get drafted and thought, "I should just get it over with." They weren’t really volunteers. When they saw how senseless the war was, many of them turned against it.

None of that seems to exist in Afghanistan. The Army and the Marines don’t seem to lack for volunteers. Young men and women are signing up knowing what they’re facing. They accept the danger. They sign up thinking they’ll live through it.

The U.S. Army was destroyed in Vietnam. Fifty-eight thousand Americans died in Vietnam. That’s a hell of a lot of people. I don’t know the exact figure in Afghanistan, but it’s nowhere near that.

Note: The Associated Press tallies 1,785 deaths of U.S. and allied troops in Afghanistan since 2001, through June 2010. That number, of course, doesn’t include the hundreds of contractors—not to mention Afghan civilians—who have also died in the Afghan war.