Scandal-plagued
Halliburton, the oil services company once headed by Vice President
Dick was secretly working with one of Iran’s top nuclear
scientist's on natural gas related projects and, allegedly, selling
the scientists' oil company key components for a nuclear reactor,
according to Halliburton sources with intimate knowledge into
both companies’ business dealings.
Just
last week a National Security Council report said Iran was a decade
away from acquiring a nuclear bomb. That time frame could arguably
have been significantly longer if Halliburton, which just reported
a 284 percent increase in its fourth quarter profits due to its
Iraq reconstruction contracts, was not actively providing the
Iranian government with the financial means to build a nuclear
weapon.
Now
comes word that Halliburton, which has a long history of flouting
U.S. law by conducting business with countries the Bush administration
said has ties to terrorism, was working with Cyrus Nasseri, the
vice chairman of Oriental Oil Kish, one of Iran’s largest
private oil companies, on oil development projects in Tehran.
Nasseri is also a key member of Iran’s nuclear development
team.
“Nasseri, a senior Iranian diplomat negotiating with Europe
over Iran's controversial nuclear program is at the heart of deals
with US energy companies to develop the country's oil industry”,
the Financial Times reported.
Nasseri
was interrogated by Iranian authorities in late July for allegedly
providing Halliburton with Iran’s nuclear secrets and accepting
as much as $1 million in bribes from Halliburton, according to
Iranian government officials.
It’s
unclear whether Halliburton was privy to any of Iran’s nuclear
activites. A company spokesperson did not return numerous calls
for comment. A White House spokesperson also did not return calls
for comment.
Oriental
Oil Kish dealings with Halliburton became public knowledge in
January when the company announced that it had subcontracted parts
of the South Pars natural gas drilling project to Halliburton
Products and Services, a subsidiary of Dallas-based Halliburton
that is registered in the Cayman Islands.
Following
the announcement, Halliburton announced the South Pars gas field
project in Tehran would be its last project in Iran. The BBC reported
that Halliburton, which took in $30-$40 million from its Iranian
operations in 2003, "was winding down its work due to a poor
business environment."
Halliburton,
under mounting pressure from lawmakers in Washington, D.C., pulled
out of its deal with Nassri's company in May, but has done extensive
work on other areas of the Iranian gas project and was still acting
in an advisory capacity to Nasseri's company, two people who have
knowledge of Halliburton's wor in Iran said.
In
attempt to curtail other U.S. companies from engaging in business
dealings with rogue nations, the Senate approved legislation July
26 that would penalize companies that continue to skirt U.S. law
by setting up offshore subsidiaries as a way to legally conduct
business in Libya, Iran and Syria, and avoid U.S. sanctions under
International Emergency Economic Powers Act (IEEPA). The amendment,
sponsored by Sen. Susan Collins, R-Maine, is part of the Senate
Defense Authorization bill.
"It
prevents U.S. corporations from creating a shell company somewhere
else in order to do business with rogue, terror-sponsoring nations
such as Syria and Iran," Collins said in a statement.
"The
bottom line is that if a U.S. company is evading sanctions to
do business with one of these countries, they are helping to prop
up countries that support terrorism - most often aimed against
America," she said.
The
law currently doesn’t prohibit foreign subsidiaries from
conducting business with rogue nations provided that the subsidiaries
are truly independent of the parent company.
But Halliburton’s Cayman Island subsidiary never did fit
that description.
Halliburton
first started doing business in Iran as early as 1995, while Vice
President Cheney was chief executive of the company and in possible
violation of U.S. sanctions. According to a February 2001 report
in the Wall Street Journal, "Halliburton Products & Services
Ltd. works behind an unmarked door on the ninth floor of a new
north Tehran tower block. A brochure declares that the company
was registered in 1975 in the Cayman Islands, is based in the
Persian Gulf sheikdom of Dubai and is "non-American."
But, like the sign over the receptionist's head, the brochure
bears the company's name and red emblem, and offers services from
Halliburton units around the world." Moreover, mail sent
to the company’s offices in Tehran and the Cayman Islands
is forwarded to the company’s Dallas headquarters.
Not
surprisingly, in a letter drafted by trade groups representing
corporate executives vehemently objected to the amendment saying
it would lead to further hatred and perhaps incite terrorist attacks
on the U.S and “greatly strain relations with the United
States’ primary trading partners.”
"Extraterritorial
measures irritate relations with the very nations the U.S. must
secure cooperation from to promote multilateral strategies to
fight terrorism and to address other areas of mutual concern,"
said a letter signed by the Coalition for Employment through Exports,
Emergency Coalition for American Trade, National Foreign Trade
Council, USA Engage, U.S. Council on International Business and
the U.S. Chamber of Commerce. "Foreign governments view U.S.
efforts to dictate their foreign and commercial policy as violations
of sovereignty, often leading them to adopt retaliatory measures
more at odds with U.S. goals.”
Still, Collins’ amendment has some holes. As Washington
Times columnist Frank Gaffney pointed out in a July 25 story,
“the Collins amendment would seek to penalize individuals
or entities who evade IEEPA sanctions — if they are "subject
to the jurisdiction of the United States."
“This
is merely a restatement of existing regulations. The problem with
this formulation is that, in the process of purportedly closing
one loophole, it would appear to create new ones. As Sen. Collins
told the Senate: "Some truly independent foreign subsidiaries
are incorporated under the laws of the country in which they do
business and are subject to that country's laws, to that legal
jurisdiction. There is a great deal of difference between a corporation
set up in a day, without any real employees or assets, and one
that has been in existence for many years and that gets purchased,
in part, by a U.S. firm. It is a safe bet that every foreign subsidiary
of a U.S. company doing business with terrorist states will claim
it is one of the ones Sen. Collins would allow to continue enriching
our enemies, not one prohibited from doing so.”
Going a step further, Dow Jones Newswires reported that the U.S.
Securities and Exchange Commission sent letters in June to energy
corporations demanding that the companies disclose in their security
filings any business dealings with terrorist supporting nations.
“The
letters have been sent by the SEC's Office of Global Security
Risk, a special division that monitors companies with operations
in Iran and other countries under U.S. sanctions, which were created
by the U.S. Congress in 2004,” Dow Jones reported.
The
move comes as investors have become increasingly concerned that
they may be unwillingly supporting terrorist activity. In the
case of Halliburton, the New York City Comptroller's office threatened
in March 2003 to pull its $23 million investment in the company
if Halliburton continued to conduct business with Iran.
The
SEC letters are aimed at forcing corporations to disclose their
profits from business dealings rogue nations. Oil companies, such
as Devon Energy Corp., ConocoPhillips, Marathon Oil Corp. and
Occidental Petroleum Corp. that currently conduct business with
countries that sponsor terrorism, have not disclosed the profits
received from terrorist countries in their most recent quarterly
reports because the companies don’t consider the earnings
“material.”
Devon
Energy was until recently conducting business in Syria. The company
just sold its stake in an oil field there. ConocoPhillips has
a service contract with the Syrian Petroleum Co. that expires
on Dec. 31.
Jason
Leopold is the author of the explosive memoir, News Junkie,
to be released in the spring of 2006 by Process/Feral House Books.
Visit Leopold's website at www.jasonleopold.com
for updates.