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Nigeria: Halliburton Pays Bribes to Lower Taxes

by David IvanovichHouston Chronicle
May 8th, 2003

WASHINGTON -- A Halliburton Co. subsidiary paid bribes totaling $2.4 million to a tax official in Nigeria in an effort to obtain favorable tax treatment, the company has revealed.

In a filing Thursday with the Securities and Exchange Commission, the Houston-based firm said a foreign subsidiary made improper payments to "an entity owned by a Nigerian national who held himself out as a tax consultant, when in fact he was an employee of a local tax authority."

The bribes were paid over a year's time, between 2001 and 2002, a company spokeswoman said.

Halliburton officials said they learned of the bribes while conducting a routine audit of the operation, a subsidiary of Halliburton's KBR, formerly known as Kellogg Brown & Root.

Several employees were fired after the discovery. No senior officers were involved, the company said.

Halliburton officials are trying to determine how much in back taxes the company owes Nigeria.

The company could have to pay as much as $5 million in additional taxes, the filing said.

While news of the bribery payments drew attention Thursday, the company publicly announced the details of the bribery incident a year ago in a similar filing with the SEC.

A spokesman for the SEC declined to comment on the bribery incident.

The Houston-based engineering, construction and oil-field service giant has been involved in a number of projects in Nigeria, including the construction of a huge liquefied natural gas plant and development of an offshore oil and gas facility.

Nigeria, when it comes to corruption, routinely scores near the bottom on surveys of world business leaders.

In last year's Corruption Perceptions Index, published by Berlin-based Transparency International, Nigeria ranked 101 out of 102, beating out only Bangladesh.

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