In a private, closed-door meeting, Obama administration officials and BP executives agreed to the creation of a $20 billion BP escrow fund. The BP escrow fund can be used to pay the damages from the oil spill. Those that are damaged by the oil spill will be able to make a claim to this BP escrow fund. The real problem, though, is the question of if the BP escrow fund will actually help.

Article Source: BP Escrow fund - Helpful or hurtful

Cap of liability not created with BP escrow

Cleaning up the BP oil spill and restoring lost income could cost as much as $ 100 billion. On the Today Show today, senior Obama adviser David Axelrod assured that "this is not a get-out-of-the-situation-free card." Administration officials have also said that if the BP escrow fund ends up not being enough cash to pay damages, BP will still be held responsible for the cost.

BP escrow fund to be administered by Fineburg

Kenneth Fineburg works as the “pay czar” for banks that received the TARP bailout. The escrow fund for victims of the September 11, 2001 attacks was also administered by Kenneth Fineburg.

Complaints spur creation of BP escrow fund

The BP escrow fund is, in part, a response to difficulties with BP’s claims process. Some BP damage claims are paid, though others are still “in consideration”. Victims are being asked to provide up to two or three years of tax documents, among other documentation.

Will the BP escrow fund distract from cleanup?

A few politicians are wondering if the BP escrow fund is really a red herring. Financial reports show that BP earned $ 5.6 billion in profit in 2009. However, Governor Haley Barbour of Mississippi has spoken out against the BP escrow fund. She expressed a concern that BP may consider it case closed once they pay to the fund.

Sources:

NowPublic.com

ABC News

AP News