Halliburton staff sacked 'for taking bribes'
Halliburton, the oil services company formerly run by the US vice-president, [censored] Cheney, was
yesterday embroiled in new accusations of corruption after it sacked two workers over allegations
that they took kickbacks for awarding sub-contracts in Iraq. The company disclosed that
investigations were going on into whether two of its staff took up to $6m (£3.3m) from a Kuwaiti-
based company providing support for US troops.
The revelation is likely to intensify the scrutiny of Halliburton, which has reaped huge contracts
to rebuild Iraq and provide logistical support for the army. The total value of their contracts is
more than $9bn, by far the largest sum handed out to a US firm in Iraq.
American Democrats have accused the Bush administration of cronyism in Iraq.
Halliburton is already facing allegations that it overcharged the US government for importing fuel
to Iraq. The top defence department auditor last week asked the inspector general's office at the
Pentagon to investigate whether the firm overcharged for petrol deliveries by more than $61m.
Halliburton gave no further details about the two executives who allegedly accepted kickbacks, or
the company that allegedly paid the bribes. The workers were based in the Kuwaiti office that also
handled the petrol contract.
The Kuwaiti firm overcharged by around $6m, and Halliburton said the two workers may have accepted
improper payments as part of the over-billing.
A Halliburton spokeswoman stressed that the company had brought the bribery allegations to the
attention of the Penta gon itself. "Halliburton internal auditors found the irregularity, which is a
violation of our company's philosophy, policy and our code of ethics. We found it quickly, and we
immediately reported it to the inspector general," she said. "We do not tolerate this kind of
behaviour by anyone at any level in any Halliburton company."
If proven, the disclosures could expose the business to fraud charges or fines.
The Pentagon is also reported to have raised broader questions about Halliburton's financial
controls and billing for work in Iraq.
The company's initial contract for rebuilding oil wells was secretly awarded to its Kellogg Brown &
Root division without a competitive tender process, in March, before the invasion of Iraq.
Last week, the company won the $1.2bn contract to replace that original deal after a long- awaited
tender process.
Henry Waxman, a California Democrat, said the granting of further work to Halliburton while an
investigation into overcharging was going on was "mindboggling".
Mr Cheney, who received a $33m severance package when he left Halliburton to run for office in 2000,
defended the company in a radio interview this week. "They get unfairly maligned simply because of
their past association with me," he said.
Halliburton is also facing corruption charges in Nigeria. A French judge has reportedly said Mr
Cheney himself could be charged over allegations that Halliburton paid bribes of $180m to the
Nigerian government to secure rights to build a gas plant. Halliburton has denied any wrongdoing.
January 24, 2004 The Guardian
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Halliburton fires workers for kickbacks Compiled by IHT Staff From Dispatches (AP, Bloomberg)
Saturday, January 24, 2004
WASHINGTON: Halliburton announced Friday that it had dismissed employees who were accused of taking
kickbacks from a Kuwaiti subcontractor helping to supply U.S. troops in Iraq.
The disclosure is the first admission by Halliburton that its employees have been involved in
possible corruption involving Iraq contracts. Wendy Hall, a spokeswoman, said Friday that the
company had reported the "irregularities" to Pentagon auditors and criminal investigators.
The Wall Street Journal reported Friday that two employees of a Halliburton subsidiary, KBR, had
accepted up to $6 million in kickbacks from an unnamed Kuwaiti company. Hall said the company could
not discuss specifics of the charges.
"We found it quickly, and we immediately reported it," Hall said in a statement. "We do not tolerate
this kind of behavior by anyone at any level in any Halliburton company."
Critics have cited Halliburton's contracts as evidence of the Bush administration's favoritism
toward its corporate friends. White House and Pentagon officials say the Defense Department's
contract decisions are not affected by political concerns.
The kickback allegations involve KBR's contract to supply U.S. Army troops in Iraq, not its separate
contract to rebuild Iraqi oil facilities and deliver gasoline to civilians. Pentagon auditors are
seeking a criminal investigation into findings that KBR and a Kuwaiti firm, Altanmia Marketing
Company, overcharged by $61 million for fuel deliveries.
Halliburton, which Vice President [censored] Cheney used to run, has denied overcharging on that contract.
The Pentagon's inspector general's office, which is investigating both allegations, declined to
comment Friday.
Halliburton disclosed last year that another KBR employee had paid more than $2 million in bribes to
a Nigerian official to get favorable tax treatment. A French judge investigating a KBR joint venture
in Nigeria with a French company has reportedly warned that Cheney, who headed Halliburton from 1995
until 2000, could be subject to criminal charges in France. Cheney has denied any wrongdoing.
On Friday, Democrats renewed their criticism of Halliburton and their demands for further
investigations into the company's contracts.
"All of Halliburton's contracts with the government need to be terminated," said Senator Frank
Lautenberg, Democrat of New Jersey. "This is a fatal blow to the company's credibility and the
administration's ability to defend these contracts."
"This demands, this begs for an investigation, and this Congress has an obligation to do it,"
Senator Byron Dorgan, Democrat of North Dakota, said on the Senate floor. "Let's suspend these
contracts right now."
Last week, Halliburton, Parsons and Worley Group won $2 billion in U.S. government contracts to
replace a no-bid contract in Iraq won by Halliburton's Kellogg Brown Root unit.
(AP, Bloomberg)