Prosecutors Prepare First Criminal Charges in BP Oil Spill

Prosecutors in the U.S. are preparing what would be the first criminal charges against BP Plc (ADR) (NYSE: BP) employees for the 2010 Deepwater Horizon accident in the Gulf of Mexico, which killed 11 workers and led to worst offshore oil spill in the U.S. history.

According to people familiar with the matter, prosecutors are preparing the criminal charges against several Houston-based engineers and at least one of their supervisors at the U.K.-based oil major. However, the scope of the investigation is not yet known. Prosecutors are investigating whether the employees provided false information to regulators about the risk related with the Gulf of Mexico well while drilling was in progress, people with knowledge of the situation said.

The charges are expected to be disclosed in 2012. A conviction on such charges carries a penalty of up to five years in prison as well as a fine.

People familiar with the situation said that the Department of Justice still could decide not to bring charges against the individuals as it is not uncommon for prosecutors to use the threat of charges to put pressure on people to cooperate in investigations.

According to legal experts, BP itself is likely to face broader criminal charges. A spokesman for BP declined to comment on the possibility for charges against its employees or the company. The company maintains that the accident was caused by a combination of events that involved multiple parties and not just BP.

A New Orleans-based federal task force has spent the last 18 months investigating the April 2010 accident. According to people familiar with the investigations, prosecutors have so far gone through thousands of documents and conducted dozen of interviews.