BP executives may face jail for manslaughter over Gulf disaster

(REUTERS)

Managers of BP could face manslaughter charges when prosecutors in the United States finally conclude their criminal investigation into the Deepwater Horizon explosion in the Gulf of Mexico last April that killed 11 rig workers and triggered the worst oil spill in US history.

The mere possibility that these and other charges may now be on the table at the US Justice Department, first reported last night by Bloomberg News, put new pressure on the shares of the energy giant.

The sources, who spoke on condition of anonymity, did not identify those managers at risk of individual charges. Involuntary manslaughter, if proven, could carry sentences of up to 10 years in prison. They also stressed that no decisions had been made and the criminal inquiry is still some way off being wrapped up.

Suggestions that prosecutors are also considering opening a perjury investigation implies that investigators are re-examining testimony given by BP executives, including that of former CEO, Tony Hayward, during congressional hearings. Some lawmakers suggested that Mr Hayward, who became a bogeyman in the US media and was replaced last summer by a US national, repeatedly stonewalled when faced with their questions. Any suggestion that he gave false testimony would be more serious, however.

After the spill, BP said it would take full responsibility and was ready to implement the environmental clean-up. Facing a barrage of criticism from the White House, the company also agreed to set up a $20bn fund to compensate Gulf Coast residents.

The US Justice Department said last June that it would open both civil and criminal investigations. BP is already budgeting for additional fines that the US government will levy on it when all the investigations are concluded. If the company is found guilty of gross negligence, which might be implied were manslaughter charges indeed to be filed, those fines could quadruple to as much as $21bn.

A decision to prosecute individuals within BP as well as the company itself would be an unusual step since it is normally the corporations themselves that are targeted. It would be seen as further evidence of the Obama administration's determination to take the toughest line possible with the UK-based company and make an example of it in this case.

"They typically don't prosecute employees of large corporations," noted Jane Barrett, a law professor at the University of Maryland. "You've got to prosecute the individuals in order to maximise, and not lose, the deterrent effect."

Shortly after the accident, the US Attorney General, Eric Holder, signalled he would encourage an aggressive approach. "We will closely examine the actions of those involved in the spill. If we find evidence of illegal behaviour, we will be extremely forceful in our response," he said. Other US officials also said at the time that individuals could eventually be targeted for criminal charges.