July 2, 2013
BP settlement fund
Ex-FBI chief to probe misconduct charges

Former FBI director Louis Freeh was appointed Tuesday to investigate alleged misconduct by a lawyer who helped run BP’s multibillion-dollar settlement fund.

U.S. District Judge Carl Barbier issued an order naming Freeh, who runs a consulting firm, a “special master” for the investigation.

Oil spill claims administrator Patrick Juneau announced last month that his office is investigating allegations that an attorney on his staff received a portion of settlement proceeds for claims he had referred to a law firm before he started working on the settlement program.

BP had called for an independent review of the allegations. A company spokesman said in a statement that it was pleased with the appointment to try to ensure the integrity of the claims process.

Barbier’s appointment of Freeh is a victory for BP as it wages an aggressive campaign to challenge what could be billions of dollars in settlement payouts to Gulf Coast businesses with claims arising from the company’s 2010 oil spill in the Gulf of Mexico. Barbier said in the order that Freeh’s duties would not be confined to allegations involving the attorney but would be a broader look at the claims settlement program.

— Associated Press

Finance industry
Prudential contests Treasury’s findings

Prudential Financial is contesting a U.S. finding that it ­poses a potential risk to the financial system, becoming the first company to challenge the tag that brings additional oversight.

Prudential requested a hearing to explain why it should not be considered a systemically important financial institution, or SIFI, the company said Tuesday in a regulatory filing.

Chief executive John Strangfeld is pursuing a different course from the leaders of American International Group and General Electric’s finance unit, which each said Tuesday that they will not contest SIFI status. The three companies said early last month that they were identified by the Treasury Department’s Financial Stability Oversight Council as potential risks to the economy. They were given until Wednesday to appeal.

— Bloomberg News

Also in Business

l  Fifty-five hospitals in 21 states have agreed to pay $34 million to the U.S. government to settle allegations that they used more expensive inpatient procedures rather than outpatient spinal surgeries to get bigger payments from Medicare, the Justice Department said Tuesday. The settlement involves kyphoplasty procedures used to treat spinal fractures usually caused by osteoporosis. It can be done as an outpatient procedure, but the Justice Department said the hospitals performed the surgeries as inpatient procedures to increase Medicare billings.

l  A federal judge approved a deal that will allow HSBC to pay a record $1.9 billion penalty to settle accusations that the British bank helped Mexican drug traffickers, Iran, Libya and others under U.S. suspicion or sanction move money around the world. The settlement, announced in December, is the largest penalty ever imposed on a bank.

l  French competition authorities confirmed that investigators raided Apple stores in France last week as part of a probe. Regulation agency Autorite de la Concurrence spokesman Yannick Le Droze confirmed a report in the French business daily Les Echos that disclosed the investigation but declined to answer questions about the reasons behind it.

— From news services

Coming Today

l  8:30 a.m.: Weekly jobless claims and international trade data for May released.

l  1 p.m.: U.S. stock market closes ahead of the July 4 holiday.

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