JURIST - Paper Chase: Sunday, May 23, 2010

[JURIST] BP [official website; JURIST news archive] is balking at an US Environmental Protection Agency (EPA) [official website] order issued Thursday directing it to find an alternative dispersant [press release] to address the Deepwater Horizon oil spill [official website] in the Gulf of Mexico. The agency Saturday released BP's response [text, PDF] to the directive [text, PDF] ordering the oil company to find a "less toxic and more effective dispersant" to combat the spill within 24 hours and begin using it within 72. Dispersants are chemicals that are used to break oil down into small droplets causing it to become more easily degradable. BP is using the dispersant Corexit 9500 [EPA chemical details] both on the surface of the spill and underwater at the source of the oil leak. BP said that it had found five possible alternatives, but stood by its decision to use Corexit 9500, saying it was a "better choice" for underwater use and had fewer long term effects. BP also said it already had a sufficient supply of Corexit and did not know whether it could obtain adequate quantities of any other chemical immediately. Portions of the response were redacted because BP cited it as confidential business information. The EPA is concerned about the environmental impact of Corexit 9500 because BP is using the dispersant in "unprecedented volumes" and because "much is unknown about the underwater use of dispersants." The EPA has not yet released a response to BP's refusal to stop using Corexit. EPA Administrator Lisa Jackson [official website] returned to the Gulf Coast [Reuters report] Sunday to continue monitoring response efforts.

On Friday, President Barack Obama signed an executive order establishing an independent commission to investigate offshore drilling and this most recent oil spill [JURIST report]. The commission will identify the causes of the spill and develop options to help prevent future incidents. The spill was a result of an oil well blowout that caused an explosion 5,000 feet below the surface of the Gulf. The amount of oil spilled into the Gulf is still unknown and part of an ongoing debate, however the resulting oil slick has covered at least 2,500 square miles. The damage from the blowout is expected to be in excess of $8 billion [JURIST comment].

[JURIST] A spokesperson for the UN peacekeeping mission in Haiti [official website] announced Saturday that the mission has launched an investigation into the shootings of dozens of prisoners in a jail riot following the January 12 earthquake [JURIST news archive] which killed over 200,000 people and left some 1 million homeless. An earlier investigation [NYT report] by the New York Times [media website] alleged that Haitian police officials opened fire on unarmed prisoners during the riot and sought to cover it up by claiming that prison ring-leader, Ti Mousson, murdered any inmates who refused to cooperate in his escape plan. According to the Times report, police officials raided the jail during the riot shouting for prisoners to lie down, but instead of securing the area began shooting the inmates, including those that had surrendered. One witness claims that some prisoners were killed systematically to "settle scores." Following the shooting, police authorities failed to notify inmates’ relatives of the deaths, buried bodies without conducting autopsies and burned the surviving prisoners’ bloodstained clothing. Prison authorities deny the allegations and claim that no shots were fired by police officers.

In February the acting head of the UN Stabilization Mission in Haiti [official website] urged Haitians to turn in prisoners who escaped [JURIST reports] when the earthquake destroyed prisons and jails. The aftermath of the earthquake also placed a strain on detainees arrested since the disaster, as limited space and limited access to judges burdened the country's already tenuous criminal justice system.

[JURIST] The US Department of Justice (DOJ) [official website] has decided not to file charges against former American International Group (AIG) [corporate website] executive Joseph Cassano, according to prosecutors from the US Securities and Exchange Commission (SEC) [official website] on Saturday. The decision appears to end a two-year criminal investigation of several executives from AIG's Financial Products subsidiary [official website], which played a large role in constructing complex contracts known as credit-default swaps [TIME backgrounder] that insured bond losses tied to the US housing market. The SEC investigation was undertaken to determine whether AIG officials deceived investors and auditors in 2007 by misrepresenting the accounting value of a credit default swap portfolio, which nearly bankrupted the company. The SEC will continue its investigation into the London-based Financial Products subsidiary and could eventually lead to civil actions.

In August former AIG executives agreed to settle [JURIST report] a suit brought by the SEC alleging their involvement in inflating the company's reported financial records. The SEC accused former CEO Maurice Greenberg and former CFO Howard Smith of being "control persons" under the Securities Exchange Act [text], making them liable for AIG's securities law violations. The SEC claimed that the two executives made false statements which allowed the company to misrepresent key earnings between 2000 and 2005. Greenberg will pay $15 million in disgorgement and penalties without admitting any charges to "put these issues behind him," while Smith settled for $1.5 million.