Oil field services company Halliburton will pay a fine of $29.2 million to resolve an investigation in which it was charged with business corruption in Angola, the U.S. Securities and Exchange Commission (SEC) said on Thursday.
The SEC charged Halliburton with violating the books and records and internal accounting controls provisions of the Foreign Corrupt Practices Act while selecting and making payments to a local company in Angola in the course of winning lucrative oilfield services contracts.
SEC's investigation found that Halliburton entered into contracts with a local Angolan company with the intention of meeting local content requirements rather than the stated scope of work.
The findings showed that Halliburton’s former vice president Jeannot Lorenz 'violated Halliburton’s internal accounting controls by starting with the local Angolan company and then backing into a list of contract services rather than first determining the services and then selecting an appropriate supplier.'
Lorenz also failed to 'conduct competitive bidding or substantiate the need for a single source of supply, and he avoided an internal accounting control that required contracts of more than $10,000 in countries like Angola with high corruption risks to be reviewed and approved by a special committee within Halliburton,' SEC said.
Halliburton agreed to pay $14 million in disgorgement plus $1.2 million in prejudgment interest and a $14 million penalty, without admitting or denying the findings.
Lorenz also agreed to pay a $75,000 penalty for causing the company’s violations, circumventing internal accounting controls, and falsifying books and records, SEC said.
The company also agreed to engage an independent consultant to review aspects of its compliance program in Africa.
By Zeynep Beyza Kilic