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BP’s Big Spill on the North Slope

The Justice Department sold out the American people when it settled an oil spill case against BP Alaska as a misdemeanor.

“It was a sellout and the citizens of this country were cheated by the Department of Justice,” said Scott West, the EPA agent in charge of the criminal investigation for the case.

West retired from his position with the EPA’s Criminal Investigation Division in Seattle last week and is now telling his story to reporters and to Congress.

West was investigating a March 2006 BP oil spill in Alaska.

A ruptured pipeline spilled 200,000 gallons of crude oil onto the North Slope.

Over West’s objections, the government entered into an October 24, 2007 plea agreement with BP that called for $20 million fine and a guilty plea to a misdemeanor.

West originally made contacts with North Slope workers in the summer of 2005 through industry whistleblower Charles Hamel.

West believes the facts of the March 2006 oil spill called for further investigation.

West and federal prosecutors wanted to investigate under a willful avoidance theory that would allow the government to pursue felony indictments.

To say the least, West did not hit it off with the U.S. Attorney in Alaska – Nelson Cohen.

West says that he was in Anchorage in October 2006 and the U.S. Attorney at the time, Nelson Cohen, requested a meeting with him.

“Cohen and I met privately in his office,” West says. “It seemed to me that he had been briefed about me before we met. He asked me what I knew about him. I told him that I knew nothing about him, but I had been expecting the Attorney General to make a recess appointment of a United States Attorney here who would come in and kill my case against BP. And then I said to him – and here you are – a recess appointment.”

West says that Cohen explained to him that he was not political and that as a career prosecutor, he would do what was proper for the case.

West says that Cohen then threatened him by saying that he would investigate and deal with media leaks.

“I told him to not do anything he did not want to read about,” West said. “We had a tense relationship.”
Nonetheless, West says that the Justice Department did support the investigation with prosecutors, paralegals and money for evidence gathering.

West says that in June 2007, the Assistant United States Attorney in charge – Aunnie Steward – was still thinking possible corporate felony counts – “and we were all looking at a number of high ranking BP employees – including some in England – as possible targets.”

Then came a momentous August 28, 2007 gathering of investigators and prosecutors in Anchorage.

West says that something happened internally at the Department between June when Aunnie Steward still wanted to pursue felony charges and that August 28, 2007 meeting.

“At that August 28 meeting, at a round table, we were asked if at this moment could we realistically charge BP with felonies,” West recalls “The answer to that specific question was no. We were then asked if there were any individuals we could charge at that time and the answer was no. The Department then told us therefore it was not in the government’s interest to continue this investigation any longer if we could get the misdemeanor count today. I argued against the rush to settlement. I explained that we had a huge volume of evidence we had not yet been able to fully review. I told them I needed another year to properly investigate this case. I was flatly told no. I then asked for six months and asked why the rush to settlement. I was dismissed.”

West says that the chief of the Criminal Division at the U.S. Attorney’s office in Alaska – Karen Loeffler – took him aside after the meeting and told him that the decision had been made by Ron Tenpas, the Assistant Attorney General for Environment and Natural Resources to conclude the investigation now and that they were “just following orders.”
West also alleges that the Department ignored fine calculations proposed by th EPA.

“The Department ignored alternative fine calculations proposed by EPA,” West said. “The question became would BP agree to plea and if so, what would the penalty be. EPA attorneys put forward ideas for a proper fine. We were told that we had to be realistic and that we would have to provide calculations pursuant to the alternative fines act. We did so and suggested several options based upon different calculations: $672 million, $319 million, $89 million, and $58 million.”

West said that U.S. Attorney Nelson Cohen said the fine would fall between $20 million and $35 million based in part on Olympic Pipeline and Selandang settlements – what West considered to be “incredibly low settlements.”

West says that the Department ignored all of EPA’s suggestions and “told us that they felt that a fine between $20 million and $35 million would be appropriate.”

“They would hold a meeting with BP counsel to hammer out the details,” West said. “I was present for these meetings – although they seemed staged and I felt that back room conversations had already occurred. I was shocked when the Department opened the negotiations at $20 million. I would have thought that they would have started at the high range – or higher – and work down. Ultimately BP accepted the $20 million number. Again I felt that the amount had already been agreed to in private.”

West says that the criminal investigation into BP’s March 2006 spill was one of the top two cases being investigated by EPA Criminal Investigative Division in 2007.

“We knew we had a lot more work to do and significant investment in terms of manpower and support were being devoted to this case by EPA, FBI, State of Alaska, and the Justice Department,” West said. “Something happened in the summer of 2007. The investigation was shut down by Justice and the resulting penalties against BP were minimal.”

The Justice Department released a statement this week saying that West’s allegations “are not based in fact and are simply not true.”

“Mr. West implies that something sinister took place between June 12 and August 28, 2007,” the statement reads. “As with any investigation, there comes a point in time when further investigation is no longer warranted if it does not have a realistic chance of generating useful evidence. In this case, the judgment by career prosecutors was that the case had been sufficiently and fully investigated to reach appropriate charging decisions. No further investigation was likely to find evidence that would shed any new light on the essential facts of the case. The investigators from the EPA and FBI agreed with the prosecution’s approach.”

This week, West was hired by Sea Shepherd Conservation Society to investigate international illegal activities that exploit marine species and habitats.

[An in-depth question/answer format interview with Scott West will run in the November 17, 2008 edition of the CORPORATE CRIME REPORTER – print edition only.]

CORPORATE CRIME REPORTER is published in Washington, D.C.

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