When an oil company’s negligence leads to an oil spill, the financial costs incurred by the company can be crippling. They have to pay clean up costs, federal fines, and, in many cases, settlements to victims who have been affected by the spill. Since these costs can be such a burden to the multi-billion dollar industry, they’ve figured out a way to recoup some of their losses by deceiving all the players involved.
Of course, these aren’t the massive oil spills that we’ve seen from Exxon and BP; these are the smaller ones that most people don’t hear about that typically occur when storage containers leak. That’s where the industry has learned that oil spills can actually be good for their bottom line.
The scheme is known as “double dipping,” and it involves oil companies receiving both insurance funds for spill cleanup along with state funds to clean up oil leaks from underground tankers. This allows the company to use funds for cleanup, and usually have a little left over to put in their pockets.
A new report by Reuters succinctly captures the essence of what’s happening in a single quote: “When I first saw these cases, I thought this is kind of incredible,” said New Mexico assistant attorney general Seth Cohen, who handled the lawsuit for the state. “The oil companies have, in effect, profited off polluting.”