November 13, 2002

Victims' Kin Find Fault With Overseer of 9/11 Fund

ith greater frequency and deepening anger, the relatives of the victims of the Sept. 11 terror attacks are growing disenchanted with the man who oversees the federal Victim Compensation Fund. They say he breaks promises, delays decisions repeatedly and provides conflicting guidance for a program that is intended to pay out billions in awards.

Family members, along with lawyers and company officials whose colleagues were killed or injured in the attacks, have complained that the fund's special master, Kenneth R. Feinberg, often promises decisions within a week or two, only to repeat the same promise for weeks, then months, without delivering. They have also accused Mr. Feinberg and his staff of being inconsistent; one relative said that he once got three different responses to the same question on pension benefits.

Members of one family who received an award that was 25 percent less than what Mr. Feinberg had personally pledged say they now feel betrayed, and are warning other victims to "be careful." And many complain that Mr. Feinberg's staff members can be overly technical in allowing minor problems on applications — like failing to check off the box to one inconsequential question — to derail the process for weeks.

Charles Wolf, who lost his wife, Katherine, an employee at Marsh & McLennan, was so unhappy about the fund that he started a Web site, www.fixthefund.org. He says Mr. Feinberg remains hugely unpopular.

"I believe in his sincerity, and I want this program to succeed for all the families," he said. "But nothing short of a major action on his part to resolve his missteps, coupled with a significant apology, will begin to set things right."

The crescendo of complaints represents a critical shift in the public perception of the fund. Early on, many family members complained that the rules governing the fund were intended to limit payouts and thus the cost to the government. Then, when the fund attracted far fewer applicants than anticipated, Mr. Feinberg attributed the poor response to wholesale grief.

But now, according to interviews with more than three dozen people involved in the fund, the debate about the fund's merits is focusing more and more on Mr. Feinberg's personal management style, as well as speculation that he is being politically shackled by the Bush administration. And the anger at Mr. Feinberg raises yet another set of questions about the eventual success of a novel program that government officials said would provide prompt, generous financial relief to devastated families.

In an interview, Mr. Feinberg acknowledged that some of his decisions had taken "too long," and that he was "sympathetic to the frustration of the families." But he also strongly defended the performance of the fund and its staff, saying that it was vital to corroborate claims and "be careful with the taxpayers' money."

He also suggested that most complaints were coming from a vocal minority that has not yet filed. By contrast, he said, most families who have received awards have told him that the payouts were fair, even generous. So if widespread disillusionment exists among the families, Mr. Feinberg hasn't noticed.

"I don't see it," Mr. Feinberg said. "I've heard more the other way, that `'we've been treated fairly, he's a man of his word, he's delivered on what he said he would.' "

But in interview after interview, victims and lawyers expressed endless exasperation with what they said was Mr. Feinberg's tendency to overpromise and underdeliver. Many of them were people who had in fact already filed with the fund, contrary to Mr. Feinberg's claim.

"His constant hesitation to make a final decision or put in writing what is said orally is just prolonging the anguish of the families," said Kenneth P. Nolan, a partner at Speiser, Krause, Nolan & Granito in Manhattan, which represents more than 60 families. "This is New York. Be an upfront guy. Tell the people the truth. If you can't do something in 10 days, then you say you can't."

Sally Regenhard, who lost her son, Christian, a firefighter, founded the Skyscraper Safety Campaign, and is in regular contact with dozens of families. She has not yet filed with the fund. "A lot of people do feel that at times this man talks out of both sides of his mouth," she said.

Few people thought that Mr. Feinberg would have an easy time with a fund that was hastily passed by Congress as part of an airline bailout package. If anything, many family members and lawyers expressed admiration that Mr. Feinberg had taken on a thankless, maybe impossible, job of attaching a sliding scale of monetary values to the dead.

But as of yesterday, only 783 people had filed even partial claims, of which less than 200 had been deemed "substantially complete" by Mr. Feinberg's office. Indeed, the pace of less than two new filings a day has not changed since the government announced its first awards in August.

Now, with only 13 months to go before the application deadline of Dec. 21, 2003, the total number of award offers stands at a modest 85, with an average payment of $1.49 million. Sixty applicants have said yes to the award. Ten have said no, and want to appeal. The rest have not yet responded.

Many family members say they have been turned off by what they characterize as Mr. Feinberg's hard-sell style, as well as with the paucity of information. In June, for instance, Mr. Feinberg agreed to evaluate, on a preliminary basis, several claims involving victims who made more than $231,000 a year — the maximum salary on the standard actuarial tables used to calculate a person's lost income and worth. He said he would have answers in a couple of weeks.

He is still saying the same thing four months later, families and lawyers say. "I've gone weeks where I've been afraid to call my clients, because they think I have an answer when I call," said Justin T. Green, a lawyer at Kreindler & Kreindler, which represents 350 families. (Yesterday, though, Mr. Feinberg called to apologize for the delays.)

And some families say that the process does not improve once an award is made. One family that filed early in order to bury the trauma of Sept. 11 remains bogged down in details over taxes and the distribution of the award, even though it has been more than two months since Mr. Feinberg promised that the process would be over within days.

"It's just been a lot of nights not sleeping, a lot of days crying," said the family member, who spoke on the condition of anonymity.

Mr. Feinberg does have his defenders. On Sept. 30, Trial Lawyers Care, a national consortium of lawyers offering free legal services, announced that despite a lengthy delay, he had made offers on a group of test cases that were, on average, more than 60 percent higher than projected.

And one family that originally accused Mr. Feinberg of breaking a verbal promise met with him recently and came away satisfied with the amended figure.

Still, when Michel F. Baumeister, an aviation lawyer in Manhattan whose firm represents 70 families, met with Mr. Feinberg to discuss six cases involving high-income families in early June, he believed Mr. Feinberg's pledge of a concrete response in two weeks.

But only yesterday did Mr. Baumeister receive such numbers from Mr. Feinberg on four of six cases. Mr. Baumeister, who has known Mr. Feinberg for years, said he wondered if the Bush administration was encouraging the special master to go slow to limit payments and bolster tort reform efforts.

Mr. Feinberg flatly rejected the thought. "The buck stops with me, and me alone," he said yesterday.

Even so, some families say that any responses, however statistically just, may amount to Pyrrhic victories because of the emotional price exacted by Mr. Feinberg's conduct.

One person who barely survived the World Trade Center's collapse applied to the fund five months ago because he suffered debilitating injuries and desperately needed financial help. But despite receiving almost weekly promises that his case would be resolved, nothing has happened — other than the fact that he has lost his house and exhausted his savings.

He said he had to quit his job as a business consultant because of his injuries. "I can honestly say this has been most frustrating and nerve-wracking experience in my entire life," said the victim, who spoke on condition of anonymity. "And that includes surviving the 9/11 collapse."