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By Samuel R. Avro on Feb 12, 2009 with no responses

Halliburton Reaches Settlement With DOJ and SEC in Nigerian Bribery Probe

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Halliburton Company, an energy industry heavyweight, announced the resolution of the previously disclosed Foreign Corrupt Practices Act (FCPA) investigations by the Department of Justice (DOJ) and the Securities and Exchange Commission (SEC).

The investigation stemmed from charges that KBR Inc., Halliburton’s former subsidiary, was actively bribing Nigerian government officials for a decade-long span to obtain $6 billion in contracts.

“On February 11, a subsidiary of KBR pleaded guilty to conspiring to violate the FCPA and to substantive counts charging violations of the anti-bribery provisions of the FCPA… The scheme commenced in the 1990’s prior to Halliburton’s 1998 acquisition of Dresser Industries, Inc. (a unit of KBR),” Halliburton said in a press release.

The SEC alleged that the chief executive of KBR’s predecessor companies, Albert Stanley, met with high-ranking Nigerian officials at least four times to arrange bribe payments in return for construction contracts. To conceal the payments, it entered what the SEC called “sham contracts” with two agents to send money to the Nigerian officials.

The Securities and Exchange Commission had also alleged Halliburton engaged in accounting and internal controls violations in relation to the case.

Despite this investigation, and another one involving the electrocution deaths of two U.S. soldiers in Iraq, KBR was recently awarded a $35 million Pentagon contract involving major electrical work.

As a result of the indemnity and the KBR subsidiary’s criminal plea, Halliburton has agreed to pay in eight installments over the next two years $382 million of $402 million in criminal fines payable by KBR as part of KBR’s resolution of the DOJ investigation, with KBR consenting to pay the remaining $20 million,” the statement continued.

Stanley pleaded guilty to bribery and related charges in September, and reached a settlement with the SEC under which he faces seven years in prison and payment of $10.8 million in fines.