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Posted on 05/09/2003 9:14:49 PM PDT by NormsRevenge
WASHINGTON (AFP) - Oil services giant Halliburton, already under fire over accusations that its White house ties helped win a major Iraqi oil contract, has admitted that a subsidiary paid a multi-million dollar bribe to a Nigerian tax official.
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Halliburton, once run by Vice President Richard Cheney, revealed the illicit payments, worth 2.4 million dollars, in a filing Thursday with the Securities and Exchange Commission (news - web sites) (SEC).
"The payments were made to obtain favorable tax treatment and clearly violated our code of business conduct and our internal control procedures," Halliburton said.
Halliburton subsidiary Kellogg Brown and Root (KBR), which paid the bribe, has been in the political spotlight since it was awarded a no-bid US government oil contract in Iraq (news - web sites) in March.
KBR is building a liquefied natural gas plant and an offshore oil and gas terminal in Nigeria.
Halliburton told the SEC the bribe was discovered during an audit of KBR's Nigerian office.
The payments were made in 2001 and 2002, Halliburton spokeswoman Zelma Branch told AFP's business ethics news service, AFX Global Ethics Monitor.
Cheney led the company as chief executive from 1995 until August 2000, when he became President George W. Bush (news - web sites)'s running mate.
"Based on the findings of the investigation we have terminated several employees," Halliburton said in the filing, adding that none of its senior officers was involved in the bribe.
"We are cooperating with the SEC in its review of the matter," Halliburton said.
"We plan to take further action to ensure that our foreign subsidiary pays all taxes owed in Nigeria, which may be as much as an additional five million dollars, which has been fully accrued."
Halliburton said its code of business conduct and internal control procedures were "essential" to the way it ran its business.
The group is already facing questions over its business in Iraq and its accounting practices.
On Tuesday, a US lawmaker said the military had revealed for the first time that KBR had a contract encompassing the operation of Iraqi oil fields.
Previously, the US Army Corps of Engineers had described the contract given to Halliburton as involving oil well firefighting.
But in a May 2 letter replying to questions from Henry Waxman, a Democrat, the army said the contract also included "operation of facilities and distribution of products."
Waxman, the top-ranking Democrat in the House of Representatives' committee on government reform, asked for an explanation.
"These new disclosures are significant and they seem at odds with the administration's repeated assurances that the Iraqi oil belongs to the Iraqi people," Waxman said.
The Army Corps of Engineers had said it decided to forgo competitive bidding on the first contract because of time constraints.
But in a May 2 letter responding to questions from Waxman, military programs chief Lieutenant General Robert Flowers said the military assigned the work to KBR's services division in November 2002, under a pre-existing contract for the firm to provide logistical support to the US Army worldwide.
Waxman has also criticized Halliburton for dealings with countries such as Iran, Iraq and Libya, cited by Washington as state sponsors of terrorism or members of the so-called "axis of evil".
I say we pull the Clinton defense club out of the bag and land this one on the green.
When the French stop doing it, we'll quit also...
U.S. Firm Halliburton Acknowledges Bribe To Nigerian Official
Jim Cason
Washington, DC
Halliburton, the giant Texas based energy company once directed by Vice President Dick Cheney, acknowledged this week it paid a $2.4 million bribe to a Nigerian government official in return for tax breaks related to operations in the West African country.
"One of our foreign subsidiaries operating in Nigeria made improper payments of approximately $2.4 million to an entity owned by a Nigerian national who held himself out as a tax consultant when in fact he was an employee of a local tax authority," Halliburton disclosed in a public filing with the Securities and Exchange Commission, the federal agency which regulates publicly trade companies.
"We have reported to the SEC that the payments were made to obtain favorable tax treatment and clearly violated our Code of Business Conduct and our internal control procedures."
In the "10-Q filing" to the SEC for the first quarter of 2003, Halliburton insisted that no senior officers were involved in this incident and that several employees who allegedly were involved in the bribe have been fired. The story was first reported today by the British newspaper The Guardian.
"We are cooperating with the SEC in its review of the matter," Halliburton wrote in making this disclosure. "We plan to take further action to ensure that our foreign subsidiary pays all taxes owed in Nigeria, which may be as much as an additional $5 million, which has been fully accrued."
Although the filing did not specify the dates the bribes were paid, the company said in response to a query from AllAfrica that the payments were made during 2001 and 2002 by the Halliburton subsidiary Kellogg Brown and Root. Cheney was chief executive officer of Halliburton from 1995 to 2000, when he left to join the Bush campaign.
Full Statement in the text reads:
Improper payments reported to the Securities and Exchange Commission.
We have reported to the SEC that one of our foreign subsidiaries operating in Nigeria made improper payments of approximately $2.4 million to an entity owned by a Nigerian national who held himself out as a tax consultant when in fact he was an employee of a local tax authority. The payments were made to obtain favorable tax treatment and clearly violated our Code of Business Conduct and our internal control procedures. The payments were discovered during an audit of the foreign subsidiary. We have conducted an investigation assisted by outside legal counsel.
Based on the findings of the investigation we have terminated several employees. None of our senior officers were involved. We are cooperating with the SEC in its review of the matter. We plan to take further action to ensure that our foreign subsidiary pays all taxes owed in Nigeria, which may be as much as an additional $5 million, which has been fully accrued. The integrity of our Code of Business Conduct and our internal control procedures are essential to the way we conduct business.
Difference between now and then: Under Clinton no one would have heard about it. The leftists did not care what he did, no matter what. I learned my lesson well from them, they gave passes, now it is our turn :)
Truer words were never spoken. That place offers nothing above the table w/o something under the table. It is pandemic. No one does anything in Nigeria except the bribe greases the skids and the palms first. Clinton's tu quoques were always obfuscations. This one is more real than you can imagine.
You can see the authors and/or editors did their best to Make Mr. Cheney's name used as prominently as possible, everywhere except the title. But, don;t forget..
Stuff indeed happens in Nigeria, people got fired, it was a subsidiary operation, Cheney was gone the year before this "went down" .. imo.. no skin off his or the admin's nose.
Nostrildamus and the sunday morning talking idiots will try and spin it, of course, especially after the demRats got their butts kicked in the House today. But who the heck will be watching 8-?
It's Mother's Day this Sunday :-)
I'd lay mony that all Haliburton employees will now be required to read and sign the company's policy concerning guidelines for acceptable grease payments.
I noticed that Haliburton was the one to call attention to itself rather than try to hide this mistake.
Back in the 80s the Economist Magazine was doing a series of articles on the economies of African Countries. When they did their analysis of Nigeria they prefaced the article with a disclaimer that any of their numbers may be off by plus or minus 25%. This was due to the wholesale corruption and theft of monies by government agencies.
In Nigeria if you do business you are corrupt or you do not do business.
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