Wed, Jul 21, 2004 - Page 1 News List

Grand jury investigates Halliburton over Iran ties


The embattled US oil services company Halliburton, that until four years ago was headed by Vice President Dick Cheney, is under grand jury investigation for sus-pected illegal dealings with Iran through a Cayman Islands subsidiary, the firm disclosed.

The company denied that any US laws have been broken. But the disclosure, made in a filing with the Securities and Exchange Commission on Monday, came as the Houston, Texas-based corporation faces multiple domestic and international probes into its operations extending from Iraq to Nigeria.

"We have a Cayman Islands subsidiary with operations in Iran, and other European subsidiaries that manufacture goods destined for Iran and/or render services in Iran," Halliburton vice president Margaret Carriere acknowledged in the filing.

She said the company received this month a grand jury subpoena requesting documents related to the operations, the nature of which remains undisclosed.

In an ominous sign, Halliburton has also been notified that the investigation, which was initially launched the Treasury Department in 2001, has now been handed over to the Justice Department.

US law bars US-incorporated entities, citizens and residents from engaging in commercial and financial transactions with Iran.

Carriere insisted there was no wrongdoing on the part of the firm.

"We completed a study in 2003 of our activities in Iran during 2002 and 2003 and concluded that these activities were in full compliance with applicable sanction regulations," she said.

A loophole in the law apparently allows US firms to circumvent the sanctions through foreign-based subsidiaries, if their dealings are not directly managed by US citizens or from US soil, according to legal experts.

There was no indication whether Halliburton had already complied with the grand jury request, but Carriere said the company intended to fully cooperate with the government's probe.

Cheney was chairman of Halliburton from 1995 until his selection as US President George W. Bush's running mate in the 2000 presidential race.

The grand jury probe is added to a multitude of other investigations faced by the conglomerate over work done by its affiliates in Iraq and Nigeria. The Pentagon and the Justice Department are looking into allegations that Kellogg Brown and Root, a Halliburton subsidiary that has secured an exclusive oil supply contract in Iraq, may have overcharged the US government by US$61 million.

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