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Weatherford International

Weatherford International

Industry: 
Drilling, Energy
Value of USG Contracts: 
2
Symbol: 
NYSE:WFT
States: 
TX
Country: 
Switzerland
Contact Information: 
Sources: 

"The United States on Tuesday announced one of the biggest settlements ever made for corporate misbehavior overseas, chronicling a litany of charges against a leading energy services provider. The charges included bribery and kickbacks in the Middle East and Africa and systematic defiance of economic sanctions on Iran and three other countries…The Securities and Exchange Commission said the company that settled, Weatherford International Ltd., a Swiss provider of oil and gas services that operates in more than 100 countries, had agreed to pay more than $250 million to resolve charges that it violated the Foreign Corrupt Practices Act and other laws from 2002 to 2011. The settlement included $91 million in fines and penalties related to illicit dealings with Cuba, Iran, Sudan and Syria that violated a range of American sanctions on those countries from 2003 to 2007. The Treasury Department, in its own announcement, said the settlement was the largest for sanctions violations outside the banking industry. A number of federal agencies, including the S.E.C., the Treasury, and the Justice and Commerce Departments, collaborated on the investigation into Weatherford’s behavior, described in the Treasury announcement as 'egregious actions which compromised U.S. sanctions.' Weatherford, which had acknowledged that it was under investigation and that it was cooperating, said in a statement from its global headquarters in Geneva that it had set aside the money for the settlement and wanted to move on. 'This matter is now behind us,' Bernard J. Duroc-Danner, the company’s chairman, president and chief executive, said in the statement. 'With the internal policies and controls currently in place, we maintain a best-in-class compliance program and uphold the highest of ethical standards as we provide the industry’s leading products and services to our customers worldwide.' In papers filed in federal court in Houston, where Weatherford has significant operations, the S.E.C. said the company had authorized 'bribes and improper travel and entertainment for foreign officials in the Middle East and Africa to win business.' It said the misconduct also included kickbacks paid in Iraq to obtain contracts under the famously corrupt and now defunct United Nations oil-for-food program, which was established in the mid-1990s and ended in 2003 after the American-led invasion of Iraq. Weatherford’s bribery transgressions, according to the complaint, included the creation of a Middle East 'slush fund' to pay foreign officials; payments to Algerian officials for a World Cup tournament trip, a daughter’s honeymoon and a religious pilgrimage; and misappropriation of funds by managers in Italy for items like golf equipment and perfume. Weatherford employees also created false accounting and inventory records from 2002 to 2007 to hide 'illegal commercial sales to Cuba, Syria, Sudan and Iran,' the complaint said. Both the sales and the efforts to conceal them, it said, violated a range of export control laws and regulations concerning those countries. Treasury officials said the timing of the announcement was unrelated to the nuclear agreement, which was announced on Sunday in Geneva and gives Iran relief, for the first time in 10 years, from some of the sanctions imposed against it…'The real question is whether the Treasury Department will be permitted politically to enforce current sanctions for current illicit activity,' said Mark Wallace, the chief executive of United Against Nuclear Iran, a New York-based group that has pushed for stronger sanctions on Iran." (New York Times, "Firm Charged With Defying Sanctions Settles With U.S.," 11/27/13)

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"In July 2007, this Houston-based oil-drilling and oil field services company announced in a filing with the Securities and Exchange Commission that it had been notified that the Bureau of Industry and Security and Department of Justice were investigating allegations of improper sales of products and services in sanctioned countries. Weatherford subsequently announced plans to get out of Iran, as well as Sudan, Syria and Cuba. This license authorized the company to enter into dealings to make good on that promise. A similar license was issued enabling the company to withdraw from Sudan." (New York Times, "Licenses Granted to U.S. Companies Run the Gamut," 12/24/10)