Sunoco to Pay $2.2 Million to Resolve Allegations over Reimbursement Claims for Hazardous Waste Cleanup
Violations of False Claims Act Allegedly Occurred Across the Commonwealth
BOSTON – Sunoco, Inc. will pay $2.2 million to resolve allegations that it sought payment from a state fund for hazardous waste cleanup at the same time it sought reimbursement from its insurers, Attorney General Martha Coakley announced today. These false claims allegedly involved service stations across the Commonwealth.
The Massachusetts Underground Storage Tank Petroleum Product Cleanup Fund program (UST Fund) was established to expedite the cleanup of environmentally dangerous leaks from underground storage tanks, such as those commonly found at gasoline stations, by reimbursing owners and operators for eligible expenses incurred in their response. To fund the program, the Commonwealth charges tank registration and delivery fees.
According to the UST Fund’s regulations, claimants must disclose if they sought reimbursement from another source including insurance for expenses they submit to the UST Fund. If claimants do recover money from both insurance and the fund for the same expenses, they must pay back the UST Fund.
“This program continues to be a resource to help keep our environment clean but its effectiveness and integrity depends on the honesty of those making the claims,” AG Coakley said. “We will continue our efforts to determine whether some oil companies may have sought or recovered money from their insurers without proper disclosure and in violation of the law.”
Sunoco allegedly failed to disclose its insurance coverage litigation and settlements reached between 1997 and 2001 as it sought and obtained reimbursements from the UST Fund program. Under the settlement agreement, Sunoco will pay $970,000 to the fund and $1.23 million to the Commonwealth’s General Fund.
The AG’s Office’s ongoing investigation centers around whether certain oil companies submitted false certifications and other false statements to the UST Fund, obtained reimbursements for which they did not qualify, concealed an obligation to pay money back to the UST Fund, or failed to disclose this obligation within a reasonable time after discovery.
Sunoco cooperated fully with the Attorney General’s investigation.
Since 2007, AG Coakley has dedicated significant resources to false claims enforcement. In Fiscal Year 2011 this initiative recovered more than $40 million for the Commonwealth.
This case was handled by Assistant Attorneys General Alex Klibaner, Amy Nable and Legal Analyst Bella Zaslavsky with assistance from Division Chief Glenn Kaplan, Assistant Attorney General Matthew Gendron and Legal Analyst Melissa Swindel, all from AG Coakley’s Insurance and Financial Services Division.