UPDATE 2-BP stalls payments to oil spill victims -Feinberg

* US Gulf Coast residents express anger at claims process

* Compensation fund chief says still tweaking rules

* Feinberg says BP lacks answers to claimants questions
(Updates with fresh quotes, details)

By Leigh Coleman

BAYOU LE BATRE, Ala., July 24 (BestGrowthStock) – British energy
giant BP Plc (BP.L: ) (BP.N: ) is holding up payments to economic
victims of the Gulf of Mexico oil spill, Kenneth Feinberg,
administrator of a $20 billion compensation fund, said on
Saturday.

“I have a concern that BP is stalling claims. Yes, BP is
stalling. I doubt they are stalling for money. It’s not that. I
just don’t think they know the answers to the questions (by
claimants),” Feinberg told reporters.

Feinberg was speaking on the sidelines of a town hall
meeting in southern Alabama at which fishermen and other
business owners expressed frustration and anger at what they
say is a slow and complex claims process that lacks
transparency.

Thousands of businesses in U.S. Gulf Coast states have been
crippled by the oil spill, which began with an explosion and
fire on a BP deepwater rig in April.

Saturday’s remarks represented the first time that
Feinberg, named last month to administer the fund, had accused
BP of holding up compensation payments. BP set up the fund in
June under pressure from President Barack Obama.

“After today there will be no more business as usual. I
learned today the depth of frustration in people here on the
coast,” Feinberg told the meeting.

90-DAY DEADLINE

Under the terms of the compensation fund, people have 90
days from when the undersea well is permanently sealed to file
claims — a limitation Alabama’s attorney general has said
needs to be changed. [ID:nN23182445]

Feinberg said he was taking the attorney general’s comments
“under advisement” and said the 90-day deadline only applies to
emergency funds. “People are getting confused with the
emergency checks,” Feinberg said.

There is also confusion about who is qualified to make a
claim. Feinberg said he is still tweaking the rules for those
who are indirectly affected by the oil spill, such as small
businesses in the tourism industry.

Real estate brokers and bankers are also asking to be
compensated for lost sales related to the spill. Feinberg said
he does not yet know whether they will be included.

Addressing the frustrated crowd in Alabama, Feinberg said
when he takes complete control over administering the fund “we
will not do anything behind your back.” BP has been managing
compensation so far but Feinberg is due to take full control by
Aug. 10.

Feinberg, an arbitration lawyer, also oversaw compensation
for executives at companies that received federal bailout
funds. Feinberg also dispensed hundreds of millions of dollars
to victims of the Sept. 11, 2001 attacks on the United States.

Investment Research

(Reporting by Leigh Coleman, writing by Matthew Bigg and
Rachelle Younglai, editing by Will Dunham)

UPDATE 2-BP stalls payments to oil spill victims -Feinberg