Houston-based Halliburton said in an SEC filing this week that it received a subpoena from the SEC in connection with an ongoing investigation of possible kickbacks and bribes in Angola.
The investigation started after an anonymous email to the company in December 2010. The message alleged conflicts of interest, self dealing, and failure to act on violations of Halliburton’s business conduct policy and the Foreign Corrupt Practices Act.
An employee was also subpoenaed by the SEC, Halliburton said.
The company first disclosed the Angola investigation in October 2011. It said then it self-reported to the DOJ and had ‘met with the DOJ and the SEC to brief them on the status of our investigation and provided them documents.’ The SEC issued the subpoenas after that initial disclosure.
Halliburton is one of the biggest oil and gas services companies in the world. It operates in about 80 countries with nearly 70,000 employees. Revenues last year were $24 billion.
The company’s shares trade on the NYSE under the symbol HAL.
In 2009, Halliburton and its then-subsidiary KBR paid $579 million to resolve criminal and civil FCPA charges. KBR was part of a consortium that paid about $180 million in bribes to Nigerian officials. The consortium won $6 billion in contracts to build LNG facilities on Bonny Island, Nigeria.
The other partners all settled FCPA enforcement actions. In 2010, Italy’s Snamprogetti paid $365 million to the DOJ and SEC and France’s Technip paid $338 million. Last year, JGC paid $218.8 million.
All four settlements appear on our top ten list. Our corporate investigations list also included Halliburton.
KBR’s former CEO, Jack Stanley, 66, is set to be sentenced by Judge Keith P. Ellison in Houston on February 23. He pleaded guilty three years ago to helping KBR and its partners bribe Nigerian officials.
Jeffrey Tesler, 62, a London lawyer who was the middleman for $130 million of the bribes, is scheduled to be sentenced in Houston on February 22. After his extradition from the U.K., he pleaded guilty last year to an FCPA conspiracy and a substantive FCPA count. As part of his plea, Tesler already forfeited $149 million to the U.S. Treasury.
The third individual defendant, Wojciech Chodan, 72, was a KBR manager in the U.K. He pleaded guilty in December 2010 to one count of conspiracy to violate the FCPA. He’s also set to be sentenced on February 22.
Halliburton Company’s full FCPA disclosure in its Form 10-K (annual report) for the fiscal year ended December 31, 2011 said:
We are conducting an internal investigation of certain areas of our operations in Angola, focusing on compliance with certain company policies, including our Code of Business Conduct (COBC), and the FCPA and other applicable laws. In December 2010, we received an anonymous e-mail alleging that certain current and former personnel violated our COBC and the FCPA, principally through the use of an Angolan vendor. The e-mail also alleges conflicts of interest, self-dealing and the failure to act on alleged violations of our COBC and the FCPA. We contacted the DOJ to advise them that we were initiating an internal investigation with the assistance of outside counsel and independent forensic accountants.
During the third quarter of 2011, we met with the DOJ and the SEC to brief them on the status of our investigation and provided them documents. We are currently responding to a subpoena from the SEC regarding this matter and are producing all relevant documents. We understand that one of our employees has also received a subpoena from the SEC regarding this matter.
We expect to continue to have discussions with the DOJ and the SEC, and we intend to continue to cooperate with their inquiries and requests as they investigate this matter. Because these investigations are at an early stage, we cannot predict their outcome or the consequences thereof.
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