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Is Halliburton the New Enron?

Halliburton, under Dick Cheney, seems no different than Enron with Ken Lay at the helm.

Around the same time that a Pentagon report discovered that Kellogg Brown & Root, a subsidiary of the multinational provider of oil field services, overcharged the government by $61 million, a French court is weighing whether or not to indict Vice-President Cheney on bribing, money laundering, and misuse of corporate assets charges.

Doug Ireland's article in The Nation sums up the brewing controversy best:

"At the heart of the matter is a $6 billion gas liquification factory built in Nigeria on behalf of oil mammoth Shell by Halliburton--the company Cheney headed before becoming Vice President--in partnership with a large French petroengineering company, Technip. Nigeria has been rated by the anticorruption watchdog Transparency International as the second-most corrupt country in the world, surpassed only by Bangladesh.

One of France's best-known investigating magistrates, Judge Renaud van Ruymbeke--who came to fame by unearthing major French campaign finance scandals in the 1990s that led to a raft of indictments--has been conducting a probe of the Nigeria deal since October. And, three days before Christmas, the Paris daily Le Figaro front-paged the news that Judge van Ruymbeke had notified the Justice Ministry that Cheney might be among those eventually indicted as a result of his investigation.

According to accounts in the French press, Judge van Ruymbeke believes that some or all of $180 million in so-called secret "retrocommissions" paid by Halliburton and Technip were, in fact, bribes given to Nigerian officials and others to grease the wheels for the refinery's construction."

It is worth noting that the same Halliburton subsidary has already admitted that it paid a bribe of $2.4 million to a Nigerian tax official in exchange for favorable tax treatment in May 2003. A brief article in Australia's The Age includes this Halliburton statement:

"'The payments were made to obtain favourable tax treatment and clearly violated our code of business conduct and our internal control procedures,' Halliburton said in a regulatory filing."

Given that admission and the rampant corruption in Nigeria, the allegations seem highly plausible. My question is though: Why is this type of stuff getting no coverage in American media? A google search on the ongoing French investigation or the May admission of bribery yield very few mentions in American press outlets. Compare that to the degree of scrutiny given to the Clintons and Whitewater. No charges were ever filed despite the fact that a special prosecuter had unlimited resources to dig up some wrong doing.

With Dick Cheney and Halliburton we have an admission of bribery, a Pentagon study confirming that a subsidiary overcharged the government, and a pending investigation into a major bribery and corporate scandal. Yet the American press is out to lunch, with the exception of The Nation.

The Center for Cooperative Research released a report that details a history of Haliburton's questionable activities. That study concludes:

"The success of Halliburton is, to a significant degree, a result of its ability to influence the decisions within the U.S. government at the legislative, judicial, and administrative levels. While this practice has filled, and continues to fill, the pockets of its executives, it also consistently works to undermine the interests of the majority of the American population and represents a considerable obstacle to promoting democracy and justice abroad. These are the conclusions that are born out in several well-documented and detailed studies performed by EarthRights International, the Financial Times, Baltimore Sun, and International Herald Tribune."

While Judge van Ruymbeke decides whether or not to indict Cheney, I'm sure conservatives will cry dirty politics and lack of jurisdiction. But, Ireland points out that:

"The notion that the judge's targeting of Cheney might be in part retaliatory for the Bush Administration's exclusion of France from Iraq reconstruction contracts is unlikely: Van Ruymbeke is notoriously independent, and his previous investigations have been aimed at politicians and parties of both right and left. He's also no stranger to the unsavory world of oil-and-gas politics, having previously investigated bribe-giving by the French petrogiant Elf--indeed, it was in the course of his Elf investigation that van Ruymbeke stumbled upon the Nigerian deal.

The suspected bribe money was mostly ladled out between 1995 and 2000, when Cheney was Halliburton's CEO."

Here is a translated version of the original article that appeared in France's Le Figaro. When you're done with article, read this one about the Pentagon's decision to cancel its contract with the Halliburton subsidary after a report showed that it overcharged the United States by $61 million to supply Kuwati fuel to Iraq.

Posted by at January 1, 2004 7:07 PM