Halliburton settles bribery case with record $559-million fine

27 January 2009

Halliburton, the US energy services group inflicted with a series of financial scandals, has agreed to pay $559 million to wrap up corruption charges bought on by the US government against its former subsidiary Kellogg, Brown & Root (KBR) for bribing Nigerian officials during the building of a liquefied natural gas plant in Nigeria.

The company said that it struck a deal with the US department of justice, under which it will pay $382 million over the next two years to the department of justice and another $177 million to the Securities and Exchange Commission on behalf of KBR.

The settlement is the largest ever penalty being paid by a US company in a bribery probe under federal law if approved by the US government and the settlement will close the company's case in the US but not in Europe and Nigeria, where investigations are still continuing.

Baker Hughes, also an US oil services company had paid $44 million as settlement charges in 2007 for bribery in Kazakstan, which was the highest paid to date.

Former vice president Dick Cheney, who once headed the company, was accused by the US government of bribing Nigerian officials by agents of its TSKJ consortium in the construction and expansion of a gas liquefaction facility at BonnyIsland in Rivers State, Nigeria.

The US government, later extended the investigation to other projects of the company going back 20 years and Albert Stanley, the then chief executive officer of KBR, pleaded guilty in September to charges of paying $180 million in bribes to Nigerian government officials.

Stanley, who worked in KBR when Dick Cheney headed the company, agreed to cooperate with US investigating officials probing the bribery scandal.

In February 2007, Halliburton sold KBR, which was one of the largest US contractors in Iraq and Afghanistan and was again hit by a financial scandal in Iraq.