BP Energy unit has agreed to pay $102m to settle a lawsuit for overcharging the US state of California for natural gas purchased between 2003 and 2012.
This settlement includes substantial penalties. California purchased natural gas from BP unit to heat classrooms and public offices.
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Attorney General Xavier Becerra was quoted by Los Angeles Times as saying: “Cheating the state of California is not a good business strategy.
“The last thing that any of us needs is to be ripped off by a company that does business with your great state and your government.”
BP, however, stated that the state’s allegations ‘were entirely without merit. BP strongly believes it honestly and fairly met its obligations under its contracts with the state’.
The probe commenced in 2012, based on a complaint filed by an unidentified former BP employee that the firm was overcharging the state.
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By GlobalDataWhile most of the settlement amount will go to the state coffers, the whistleblower will also receive part of it.
Becerra said: “British Petroleum thought it could get away with overcharging the state of California by providing false and misleading information to help its own bottom line.”
The state has no longer contracted BP for natural gas.
Department of General Services spokeswoman Monica Hassan was quoted by Associated Press as saying that the contract had come to a natural end and was not cancelled due to the probe.
According to the lawsuit, BP overcharged the state by anywhere between $150m and $300m.
Under the California False Claims Act, the state had sought triple damages.
