(The item "CORRECT: Halliburton, KBR Finalize $579M Settlement
In Bribery Probe," published Wednesday at 4:01 p.m. EST, misstated
the name of the act in the first paragraph. The corrected version
follows.)
DOW JONES NEWSWIRES
A KBR Inc. (KBR) unit has agreed to plead guilty to violating
the Foreign Corrupt Practices Act for bribing Nigerian government
officials for a decade-long span to obtain $6 billion in contracts
as the company and former parent Halliburton Co. (HAL) finalized a
$579 settlement of federal corruption charges.
The Securities and Exchange Commission had also alleged
Halliburton engaged in accounting and internal controls violations
in relation to the case.
The deal was announced last month, with the total settlement
amount then put at $559 million. The payments smash the prior
record in a bribery investigation.
As part of the settlement, the federal government agreed not to
prosecute Halliburton as part of the bribery scheme but the company
agreed to be jointly liable with KBR. The company had indemnified
KBR from fines or other penalties prior its 2006 spinoff.
The KBR unit, Kellogg Brown & Root LLC, will pay $382
million to settle the allegations by the Securities and Exchange
Commission and Justice Department, with KBR paying $20 million.
Halliburton's cost is $177 million.
The SEC alleged that the chief executive of KBR's predecessor
companies, Albert Stanley, met with high-ranking Nigerian officials
at least four times to arrange bribe payments in return for
construction contracts. To conceal the payments, it entered what
the SEC called "sham contracts" with two agents to send money to
the Nigerian officials.
Stanley pleaded guilty to bribery and related charges in
September, and reached a settlement with the SEC under which he
faces seven years in prison and payment of $10.8 million in
fines.
The SEC alleged that Halliburton failed to come up with adequate
controls to govern such practices, and that as a result of the
scheme, Halliburton records contained false information relating to
the payments.
KBR's shares were recently down 2.7% at $14.47 and Halliburton's
were up 3 cents at $18.36.
-By Kerry E. Grace, Dow Jones Newswires; 201-938-5089;
kerry.grace@dowjones.com