SEC Settles Fraud Case Related To Deepwater Horizon Oil Spill With BP for $525 Million

SEC v. BP p.l.c, Case No. 2:12-cv-02774 (E.D.  La.).  On November 15, 2012, the SEC announced a settlement with BP in connection with claims the company mislead investors while the Deepwater Horizon oil rig was leaking oil into the Gulf of Mexico.  The SEC’s complaint alleges that BP made false public statements in SEC filings indicating a flow rate estimate of 5,000 barrels of oil per day when its own information showed possible flow rates as high as 146,000 barrels of oil per day.  Additionally, BP executives made public statements criticizing higher estimates by third parties.  The $525 million penalty is the third largest in the SEC’s history.  Without admitting or denying the SEC’s allegations, BP has consented to the entry of a final judgment ordering it to pay the $525 million penalty and permanently enjoining the company from violating Sections 10(b) and 13(a) of the Exchange Act and Rules 10b-5, 12b-20 and 13a-16.  BP also pleaded guilty to criminal conduct in a parallel criminal proceeding brought by the United States Department of Justice.

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