Bribery scandal rocks Big Oil

When oil mixes with greed

Stanley's rise and fall, detailed in U.S. and leaked French court documents, show what can happen when corporate greed mixes with the autocratic governments that control valuable natural resources such as oil and copper in lawless corners of the globe.

Now 65, Stanley spent nearly his entire career in the oil business, a globe-trotting high-level roustabout who made a specialty of dealing with governments in resource-rich, accountability-poor countries. He owned a million-dollar home in Texas and a residence in one of London's swankest neighborhoods -- a property that he will now have to sell under his plea agreement.

A fearsome competitor, Stanley had a reputation as a hard drinker. At his hearing in Texas, Stanley held himself up by gripping the podium, and he looked frail. He appeared to wince at references to alcoholism as a mitigating factor for his actions and to statements by the government prosecutor William Stuckwisch, who characterized Stanley's behavior as "egregious."

"Jack was . . . extremely capable, smart and totally dedicated to the company,'' said one former colleague, who did not want to be identified because of the continuing investigation. "I was shocked like everyone else when we heard about the bribes."

Others expressed less surprise that Halliburton was involved. Walter Carrington was the U.S. ambassador to Nigeria in 1994, when Stanley acknowledged making the first bribe payments to the Nigerian government.

"I used to brag that because of our Foreign Corrupt Practices Act, Americans weren't involved as other countries were. American businessmen would complain that it wasn't fair -- (that) other countries really ought to be doing more to keep people from doing this. It was a competitive disadvantage,'' said Carrington, who did not recall meeting Stanley. "Halliburton was a different kettle of fish. There were always stories going on about the way in which their people operated."

Stanley began his rise up the corporate ladder with M.W. Kellogg, an oil infrastructure company then owned by Dresser Industries. Dresser would later merge with Halliburton, and Kellogg would become KBR.

Stanley was working as a senior executive at Kellogg in the 1990s when the company formed a joint venture called TSKJ to pursue contracts to construct a liquefied-natural-gas plant on Bonny Island off Nigeria's oil-rich coast. Besides Kellogg, the TSKJ companies were France's Technip (TNHPF, news, msgs); Snamprogetti Netherlands, an affiliate of Italy's Eni (EIPAF, news, msgs); and Japan's JGC (JGCCF, news, msgs).

As Nigerian officials weighed the consortium's bid against a competing group led by San Francisco-based Bechtel Engineering, Stanley decided to improve the chances of winning by offering bribes, according to court documents filed by the Justice Department and the SEC.

He hatched a plan to hire consultants who could direct the money to Nigerian officials, the court documents said. A consultant from the United Kingdom would pay off higher-level Nigerian officials, while a second, from Japan, would be responsible for bribing lower-ranking officials.

In November 1994, the U.K. consultant, who was not identified, allegedly told an associate that it would take $60 million to secure the contract, the court documents said. Of that money, $40 million to $45 million would go to the "first top-level executive branch" of Nigerian officials, while an additional $15 million to $20 million would go to other Nigerian officials.

Later that month, Stanley traveled to the Nigerian capital to meet with senior officials and confirm that the U.K. consultant would serve as a go-between, according to court documents and officials familiar with the investigation.

Over the next year, TSKJ, operating through subsidiary companies in Madeira, Portugal, in the Portuguese offshore tax haven of Madeira Island, signed agreements to transfer millions of dollars to the U.K. consultant, according to court documents and people familiar with the investigation.

In December 1995, the Nigerian government awarded the first of the gas plant contracts to TSKJ. Over the next decade, the government awarded TSKJ four contracts worth a total of $6 billion to build and expand the plant.

Throughout that time, Stanley continued traveling to Nigeria to meet with senior officials and continued arranging payments through the U.K. and Japanese consultant firms, according to the court documents.

Abacha died suddenly in 1998. According to Nigerian press accounts, his death was either the result of a marathon Viagra-fueled orgy with four prostitutes or a conspiracy among his closest confidantes to poison him. No autopsy was ever performed. In the decade since Abacha's death, Switzerland alone has returned at least $500 million in his bank accounts to the government of Nigeria.

Continued: The Cheney connection

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