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Hood wants the GCCF, Feinberg to open the books

Real quick, here’s the full press release from Attorney General Jim Hood’s office.

Attorney General (AG) Jim Hood has filed a petition with the Court to force the Gulf Coast Claims Facility (GCCF) and its administrator, Kenneth R. Feinberg to obey an AG subpoena pertaining to certain documents relevant to an investigation of the BP claims process.

 “Mr. Feinberg and the GCCF have continually made promises of compliance, but have failed to fully provide necessary information despite our repeated requests and reasonable efforts to resolve the issues,” said Attorney General Hood.  “All they have managed to do is delay, deny, deceive and dissemble.”

 The Attorney General’s Petition, filed in Hinds County Chancery Court today, asks the GCCF and Feinberg to respond to the subpoena that was served in February.  The petition says that the Attorney General has reason to believe that the GCCF and Feinberg may have violated or may be violating the Consumer Protection Act, and that he needs the documents requested in the subpoena to make this determination. 

 “We hope that by asking a court to open up the GCCF claims process for review, we will be able to ensure that victims of last year’s oil spill are being adequately and fairly compensated for their losses,” said Attorney General Hood.  “My job is to protect the citizens of Mississippi.”

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  1. Mark Putnal
    July 12th, 2011 at 17:41 | #1

    I wish the Florida Attorney General was as concerned about the fraud and abuse within the GCCF as the Mississipp AG. There is deception, inconsistency, inaccuracy and unbelievable lack of transparency. If our federal government does not become involved it will be the same thing as a “bailout” for another negligent an abusive megacorporation. There is only one guideline that Mr. Feinberg is concerned with and that is to save BP 15 billion dollars. When the oil was gushing out in historical quantities of pollution and BP was adding toxic dispersants in historical quantities there was support from every American citizen to pass an emergency amendment to increase the limits in OPA. BP deceptively sidestepped this political involvement by committing to a 20 billion dollar fund. That number did not just appear out of the blue. The economic damages caused by this disaster will easily exceed that amount when it is all said and done by BP will not foot that bill unless they are forced to. Most claims have no ability to appeal a blatantly flawed damage claim methodology.

    Projected revenue: GCCF is using the lowest year of historical gross revenue for projected revenue. The common practice is 4 or 5 years of revenue throwing out the highest and lowest years and averaging the others. This is not rocket science.

    LOI%. This is the factor that is applied to lost revenue to determine income loss. GCCF does not take into account damages to cash flows, unit cost, volume purchasing, volume sales, underutilization of land, underutilization of buildings, underutilization of equipment, investments made toward expansion and future growth. The smaller the business the longer it takes to overcome these damages. This is more complicated but basicly it calculates to the average gross profit for the last 4-5 years plus the percentage damage to gross revenue.

    Full Recovery factor. There is only one way to calculate a full recovery but you must first have 5 or 6 months of some recovery. Many businesses as of June 30th have not shown any recovery despite what Mr. Feinberg is telling us. A recovery begins when actual revenue exceeds 2010 post spill revenue. It will be the end of this year before anyone can accurately predict a full recovery. A full recovery is simply when actual revenue intersects with projected revenue. Once recovery begins you can calculate a rate of recovery that will eventually intersect with projected revenue. This is simple forensic accounting utilizing simple math. Mr. Feinberg/GCCF/BP uses some sort of voodoo economics.

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