Hess Corporation to Pay $4.4 Million for Illegally Obtaining State Reimbursements for Gas Station Cleanup Projects
BOSTON – Hess Corporation has agreed to pay $4.4 million over allegations that it illegally obtained reimbursements from a state fund for environmental cleanup projects at dozens of gasoline service stations throughout Massachusetts, Attorney General Maura Healey announced today.
The consent judgment entered in Suffolk Superior Court, resolves allegations that Hess and Merit Oil (acquired by Hess in 2000) submitted falsely certified reimbursement applications to the Massachusetts Underground Storage Tank Petroleum Product Cleanup Fund program (UST Fund) without disclosing the companies’ insurance claims, which Hess eventually settled with the insurers.
According to the AG’s complaint, filed in April 2012, Hess and Merit Oil falsely certified to the UST Fund that their submissions were in compliance with the applicable regulations. As part of the consent judgment, Hess admits that it failed to comply with the UST Fund’s disclosure requirement.
“This company refused to play by the rules designed to protect state funds from being used for expenses potentially covered by insurance,” AG Healey said. “We expect businesses to comply with state regulations to ensure the appropriate use of state resources in environmental cleanup costs.”
The 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 for eligible expenses incurred in their response. According to the UST Fund’s regulations, claimants must disclose if they have sought reimbursement from another source including insurance for expenses they submit to the fund.
Under the terms of the consent judgment, Hess must pay $1.9 million to the UST Fund and $2.5 million to the Commonwealth.
In April 2012, the AG’s Office announced a $2.2 million settlement with Sunoco involving the company’s claims to the UST Fund. In December 2012, Chevron agreed to pay $1.7 million to resolve allegations they falsely received reimbursement payments. In February 2014, Shell agreed to settle for $4 million the AG’s Offices allegations that it submitted false reimbursement claims.
The consent judgment with Hess brings the total recoveries obtained by the AG’s Office to more than $12 million.
This matter was handled by Assistant Attorney General Alex Klibaner along with Deputy Chief Monica Brookman from AG Healey’s Insurance and Financial Services Division and with assistance from Investigator Anthony Crespi of the Investigations Division.