Economy
Ex-BP manager to pay $224,000 over 2010 oil spill insider trading charges
A former BP employee is set to pay a $224,118 (£133,500) settlement for charges relating to the firm’s 2010 oil spill in the Gulf of Mexico. He is accused of having sold $1m of shares in the company before the information on the gravity of the incident became publicly available.
BP shares fell almost 50% when news of the disastrous effects of the Deepwater Horizon oil spill was released.
Former BP crisis manager Keith Seilhan, who neither admitted nor denied the charges, reportedly sold the shares after being informed about the accident, but before the details were made public. Seilhan had been working for BP for 20 years.
The US Securities and Exchange Commission, which investigated the case, said that by selling his family’s portfolio of shares, Seilhan sidestepped considerable losses caused by the subsequent fall in value.
Daniel M Hawke, chief of the Division of Enforcement’s Market Abuse Unit, said, “Seilhan sold his family’s BP securities after he received confidential information about the severity of the spill that the public didn’t know.
“Corporate insiders must not misuse the material nonpublic information they receive while responding to unique or disastrous corporate events, even where they stand to suffer losses as a consequence of those events.”
According to Seilhan’s lawyer Mary McNamara, the former employee agreed on the settlement to “avoid further distraction and protracted litigation”.
The 2010 oil spill in the Gulf of Mexico killed 11 people and enormously damaged the marine ecosystem and local communities, with 5m barrels of crude oil released into the water.
Photo: kris krüg via flickr
Further reading:
14 species still recovering from BP oil spill, conservationists say
BP finds first major Gulf of Mexico oil reserve since Deepwater Horizon catastrophe
BP returns to US courts over Deepwater Horizon spill
BP Gulf compensation fraud hotline hijacked to accuse oil giant of misbehaviour
BP contests Deepwater Horizon payback scheme amid fears it could run out of money