Spurred by the recent U.S. attempt to overthrow the government of Venezuela, Lucy Komisar offers a never-told story about the international corruption of state oil company PdVSA many years ago, under a pro-business administration in Caracas.
5 Rue des Italians, Paris. (Google Earth)
By Lucy Komisar
Special to Consortium News
Part of the ongoing U.S. demonization of the Nicolas Maduro government of Venezuela is to accuse it of corruption. In 2017, for example, U.S. prosecutors charged five former Venezuelan officials under the Foreign Corrupt Practices Act (FCPA) with soliciting bribes in exchange for helping vendors win favorable treatment from state oil company PdVSA from 2011 to 2015. (Hugo Chávez was president 2006 to 2013, and Maduro became president in 2013.)
However, there’s another example of PdVSA bribery that the U.S. never felt compelled to pursue. It is the alleged and never investigated Halliburton bribery of Venezuelan oil company officials in the late 1990s when Halliburton was run by Dick Cheney, who would leave it to become vice-president under George W. Bush.
Exposing that story shines a light on the political motivation of Washington’s current attacks on Venezuela.
The story involves Halliburton subsidiary Brown & Root allegedly participating in a payoff to PdVSA with its French partner Technip in order to get oil facility construction contracts in Venezuela in 1997 and 1998.
This was revealed to a French investigating magistrate by the Technip official who managed the bribe affair and who told me the story.
At that time in France, before 2000, foreign bribery was legal, only kickbacks to French individuals and companies were barred. The magistrate therefore determined there were no kickbacks and dropped the case. But his investigation was reported at the time in the French press and would have been seen by FBI officials at the U.S. embassy and by State Department analysts at the embassy and in Washington. But the U.S. ignored this story of a Foreign Corrupt Practices Act violation.
Rue des Italiens
Over the course of two years, in 2001 and 2002, Georges Krammer paid several visits to 5-7 Rue des Italiens, a classical stone edifice in the cul de sac of an elegant Right-Bank boulevard in Paris, in which a French magistrate, Renaud Van Ruymbeke, had an office.
During that time, Van Ruymbeke was investigating a bribery case concerning Elf, the state-owned French oil giant. Krammer was of interest to him because of Elf’s connection with Technip, a French company that constructed drilling-and-production facilities for oil-and-gas fields. Krammer was Technip’s general manager.
The meetings were private, but Krammer, in emails and conversations with me almost 10 years ago, described some of what was said.
At first Van Ruymbeke was mainly interested in Ely Calil, a notorious Lebanese bagman who was accused of handling Elf bribes with Nigeria but was released on appeal. But at a certain point, Krammer said, Van Ruymbeke began to zero in on Technip’s overall bribe operation in Nigeria as well as Venezuela. Foreign bribery, at the time was legal in Europe, but domestic bribery was not. He was looking for illegal “retro-commissions,” kickbacks to French citizens or political parties.
The multi-million-dollar bribe operation involved international conglomerates using partnerships and subsidiaries to conduct business with one another. A common denominator among them was the use of bribes to grease work contracts in the oil-producing nations of Nigeria and Venezuela.
For U.S. companies the international relationships were key since bribing foreign officials violated the U.S. Foreign Corrupt Practices Act.
One of the parent companies in this network was Halliburton, the Houston-based multinational oil-services behemoth for which Dick Cheney, the former U.S. vice president under George W. Bush, served as board chairman and CEO from 1995 to 2000.
Officials for Technip, (which has since merged to form TechnipFMC with headquarters in London), declined to be interviewed. Halliburton declined a request for comment on this article, as did Cheney’s office.
Former Vice President Dick Cheney in 2011. (Flickr/Gage Skidmore)
Venezuelan Contracts Wanted
Technip’s partners in Venezuela were Brown & Root, the engineering-and-construction giant that has since been subsumed by a merger, but was a Halliburton subsidiary at the time; Parsons E&C, a U.S. provider of construction-management services that has since been acquired; and two Venezuela firms. They wanted several contracts to build oil production facilities in Venezuela. To get them, they would allegedly pay bribes through a shell company, Contrina, which Technip set up in Paris. (Georges Krammer’s name appears in Contrina’s listing in the French corporate registry.)
“The American companies make use of the European companies to pay the bribes, because they could do it,” Krammer told me. Because bribery [in Europe] had been legal until 2000, he said European companies were expert at it. “They were working with U.S. companies,” said Krammer. “They told them we will arrange everything, don’t worry. This is how Technip operated.”
Krammer told me that the bribes were around 1.5 percent of the value of the contracts, which when combined were worth about $1.25 billion. Delivering the payments was also lucrative business. During the time Krammer was meeting with the judge, Karl Laske of the Paris daily Libération was also investigating Ely Calil. Laske wrote in October 2002 that Technip had paid bribes to get a contract to build an oil-refinery facility in Venezuela and that Calil had had been awarded $8.5 million for handling payoffs.
Ultimately, the judge did not bring the Venezuela case to court, since such bribery of foreign officials was legal in France until 2000, when OECD rules forced changes in national laws. Till then, French companies just had to report the bribes to the French Treasury.
According to French court documents, Van Ruymbeke ultimately dropped the case.
But the investigation that he began should have had consequences for some of the U.S. entities and individuals involved in the Venezuelan network.
No Probe Into Cheney
Although the Nigerian bribery was already underway when Cheney took charge, the Venezuelan operation began under the former vice president, via Halliburton’s Brown & Root.
But though the U.S. Justice Department went after and fined the companies and individuals in the Nigerian case, it never went after a Halliburton/Brown & Root Venezuela bribery operation.
Krammer said the Venezuela bribes began in the late 1990s, with contracts that Contrina signed in 1997 and 1998. They went to officials of the state oil company, PdVSA (Petroléos de Venezuela) during the administration of pro-business President Rafael Caldera, who preceded the leftist President Hugo Chávez.
Former Venezuelan President Rafael Caldera in 1980. (Sucesión Caldera Pietri/Fundación Tomás Liscano, CC BY-SA 4.0, Wikimedia Commons)
The two contracts were to build facilities in Port La Cruz, on the Caribbean, that would upgrade extra heavy oil produced in the Orinoco region of Venezuela. The upgrader turned the oil into synthetic crude (syncrude), so it could be shipped in tankers to Conoco’s U.S. refineries, most of it to the Westlake site in Louisiana. The oil deposit was expected to last 35 years.
“Contrina, based in Technip offices in France, gathered the agreements of its U.S. partners to pay the bribes,” Krammer told me in an email in 2011. “Contrina SNC paid the bribes to Rossven (offshore vehicle for bribery).” He said the beneficiary of Rossven was the bagman Calil who did what was necessary.
Krammer said, “Brown & Root, Parsons and Technip signed papers that we can place the bribe with Calil.” He said the U.S. signatories on the agreement were Senior Vice President Lawrence J. Pope for Brown & Root and Bill Hall for Parsons E&C. Payments were made in 1998 and 99. They were sent from a Contrina Paris bank account owned by Krammer.
“Who got the bribes? I’ve no idea,” Krammer said. “It’s individuals helping to get the contract. There is always a recommendation. The people you bribe are the local ones. People related to PdVSA.”
Brown & Root’s participation in Contrina was reported by trade publications at the time.
Portion of Venezuela’s Caribbean coastline with Puerto La Cruz circled. (Google Earth)
Bribe Handlers
When Van Ruymbeke began meeting with Krammer almost 18 years ago, he was interested in Krammer’s tenant-landlord connection with Ely Calil, the bribe handler for Elf’.
“He found out Calil was in contact with Technip,” Krammer said. “He found out the owner of my apartment was Calil.”
Van Ruymbeke thought that Krammer might have bribed Calil to get the apartment, which would have been a crime.
“It was just when I retired in 2001,” Krammer said. “I wanted to rent the apartment with a contract. And I paid. When Van Ruymbeke discovered this, he said you got a kickback and bought the apartment, which was not correct. After a year, he said there is no evidence Georges has a kickback, so he released me from the case.”
Over the course of their conversations, Krammer showed Van Ruymbeke the contract and records of the Contrina partners’ due diligence investigations of Calil for the deal in Venezuela.
Krammer waited for Technip to bail him out on the Venezuela bribery charges, but the firm didn’t. Technip officials denied knowing Calil and accused Krammer, who admitted he handled the bribe payments.
Krammer, in turn, began trying to prove that bribery was a Technip policy and told Van Ruymbeke how Technip’s payoff system worked — in Indonesia, Thailand and at the Bonny Island gas plant in Nigeria. He also showed Van Ruymbeke the Venezuela contracts and records of the due-diligence investigations of Calil that the partners associated in Contrina had carried out before hiring him to be their bagman.
In October 2002, Van Ruymbeke got a copy of the “DAS,” a document that in French means a “declaration of honorariums and other remunerations,” which Technip had filed with the French Treasury to report bribes.
Krammer said that in its DAS, Technip would have to declare the other companies involved and indicate if each was paying the same bribe. But the judge saw no mention of the Boney Island Nigeria gas-plant bribery or the case in Venezuela in Technip’s disclosure of foreign bribery. The judge began to track both bribe operations.
When Krammer saw the DAS, he said, “I told Van Ruymbeke, ‘This is why they didn’t want to give you the DAS, because there were missing projects.’”
Portion of Puerto La Cruz with oil facilities. (Google Earth)
My Own Investigation
I came across Van Ruymbeke’s bribery investigation against Brown & Root and partners about 10 years ago, while investigating the contemporaneous bribery of Nigerian officials by Halliburton and its partners in France, Italy and Japan. The case, which drew plenty of press coverage, involved construction of gas plants and was settled in the U.S. with fines.
Technip by then had been shown to be a key collaborator in a corrupt Nigerian deal with M.W. Kellogg, a London-based engineering and construction subsidiary of the U.S. company Dresser Industries. (In 1998 Kellogg entered Halliburton’s web of corporate relationships when its parent, Dresser, merged with Halliburton. Following that merger, Kellogg combined with Halliburton subsidiary Brown & Root to form KBR.)
Halliburton’s even cursory due diligence before buying Dresser should have revealed that its subsidiary Kellogg led a Nigeria project which included Technip. And that Halliburton’s own construction subsidiary Brown & Root was involved with Technip in Venezuela. The Nigeria bribery records after 1998 belonged to Halliburton.
But Dick Cheney was never charged or interrogated about the Nigeria bribery. The Bush administration made plea bargains with all the companies involved, so that no documentation was made public.
The U.S. Justice Department never brought charges against Halliburton/Brown & Root for the Venezuela payoffs. One can’t know if they ever investigated it. The Justice Department never mentioned it.
Once the Venezuelan case fizzled in the U.S. I filed away my notes on Krammer and Van Ruymbeke’s investigation. But the recent U.S. attempt to overthrow the democratically elected government of Nicolás Maduro, and the hailstorm of official invective against the Chavista system, made me think the story was worth finally telling.
Lucy Komisar (@lucykomisar) is an investigative journalist whose stories are available at http://thekomisarscoop.com/.
If you value this original article, please consider making a donation to Consortium News so we can bring you more stories like this one.
Before commenting please read Robert Parry’s Comment Policy. Allegations unsupported by facts, gross or misleading factual errors and ad hominem attacks, and abusive language toward other commenters or our writers will be removed. If your comment does not immediately appear, please be patient as it is manually reviewed.
Obviously important news, obviously will never be seen
The Komisar strikes again!
There are a couple old adages that apply: Change can only come from outside; and you do not ask the fox to guard your chickens.
If you are a chicken and think by asking protection from those who are part of the fox dens is a grand idea, then get ready to be plucked.
His picture should be on a “Wanted (preferably) Dead or Alive” poster.
At one time, 10 and more years ago this investigative journalist findings may of came out in mainline Media within US and not Just Cheney but Bush Family connections in Carlyle Group also would of came about.
Yet there was a Censorship Executive Order under Little Bush that retroactively placed almost all of Daddy Bush and he and Cheney’s oil connections plus during his tenure within CIA.
That even records that were once classified as being under Public Domain and had been published as such, many of them became Secret.
Does US populace have any real interest in how our foreign policies ,even as to the whys of our Military interventions, are connected by graft?
Do not most know that corruption within upper reaches of Government is no longer an exception but the rule, and that such corruption is extended to include internationally connected powers of Finance?
Today is a world where even such insane comments of President Trump, that he could walk onto street and publicly murder someone and still remain as President, does not even give pause to the Public?
What is realy scary is that he was and still is right in saying so.
OF course Smaller Bush claims of God told him to attack Afghanistan and Iraq was but a short 1 paragraph within all of popular media outlets.
While such facts as are in above article are titillating, today hat is all they can accomplish, to titolate the fancy of the few.
Thank you Lucy Komisar for this it is indeed important because it helps establish a track record that will be helpful in the up and coming America Truth And Reconciliation Commission (Hopefully)…
Ain’t never gonna happen. Truth and Reconciliation Commissions should have been formed if the Iran Contra Investigation had been allowed to proceed to the conclusion that The Reagan administration and Vice President George Bush were not only operationally aware of the Iran Contra arms deal but that Bush had secret meetings with Iranian officials in Paris leading up to the October Surprise. In his book Firewall: The Iran-Contra Conspiracy and Cover-up by Lawrence E. Walsh, special prosecutor details how, with Ronald Reagan’s knowledge and support, the United States attempted to trade arms for hostages held by Iranian terrorists; some of the secret money then funded the guerrilla activities of the Nicaraguan Contras, a counter-revolutionary group that Congress had specifically forbidden the administration to support. In this historic, first-person account, the independent counsel in the Iran-Contra investigation exposes the extraordinary duplicity of the highest officials of the Reagan administration and the paralyzing effects of the cover-up.
It is also a story about William Barr the current DOJ Chief who was key in stopping the IranGate investigation. That is correct. The same William (Bill) Barr that defended Reagan and Bush was rehired for the job by Trump.
Bill Barr’s Remarkable History Of Scandalous Cover-Up
Thom Hartmann March 25, 2019
Back in 1992, the last time Bill Barr was U.S. attorney general, iconic New York Times columnist William Safire referred to him as “Cover-up General Barr” because of his role in burying evidence of then-President George H.W. Bush’s involvement in “Iraqgate” and “Iran-Contra.”
General Barr has struck again—this time, in similar fashion, burying Mueller’s report and cherry-picking fragments of sentences from it to justify Trump’s behavior. In his letter, he notes that Robert Mueller “leaves it to the attorney general to decide whether the conduct described in the report constitutes a crime.”
As attorney general, Barr—without showing us even a single complete sentence from the Mueller report—decided there are no crimes here. Just keep moving along.
Barr’s history of doing just this sort of thing to help Republican presidents in legal crises explains why Trump brought him back in to head the Justice Department.
On Christmas Day of 1992, the New York Times featured a screaming all-caps headline across the top of its front page: Attorney General Bill Barr had covered up evidence of crimes by Reagan and Bush in the Iran-Contra scandal.
Earlier that week of Christmas, 1992, George H.W. Bush was on his way out of office. Bill Clinton had won the White House the month before, and in a few weeks would be sworn in as president.
But Bush’s biggest concern wasn’t that he’d have to leave the White House to retire back to Connecticut, Maine, or Texas (where he had homes) but, rather, that he may end up embroiled even deeper in Iran-Contra and that his colleagues may face time in a federal prison after he left office.
Independent Counsel Lawrence Walsh was closing in fast on him, and Bush’s private records, subpoenaed by the independent counsel’s office, were the key to it all.
Walsh had been appointed independent counsel in 1986 to investigate the Iran-Contra activities of the Reagan administration and determine if crimes had been committed.
Weinberger, trying to avoid jail himself, was preparing to testify that Bush knew about it and even participated, and Walsh had already, based on information he’d obtained from the investigation into Weinberger, demanded that Bush turn over his diary from the campaign. He was also again hot on the trail of Abrams.
Times columnist Safire referred to him not as “Attorney General” but, instead, as “Coverup-General,” noting that in another scandal—having to do with Bush selling weapons of mass destruction to Saddam Hussein—Barr was already covering up for Bush, Weinberger, and others from the Reagan administration.
On October 19, 1992, Safire wrote of Barr’s unwillingness to appoint an independent counsel to look into Iraqgate:
Why does the Coverup-General resist independent investigation? Because he knows where it may lead: to Dick Thornburgh, James Baker, Clayton Yeutter, Brent Scowcroft and himself [the people who organized the sale of WMD to Saddam]. He vainly hopes to be able to head it off, or at least be able to use the threat of firing to negotiate a deal.
Was the Iran-Contra criminal conspiracy limited, as Reagan and Bush insisted (and Reagan confessed on TV), to later years in the Reagan presidency, in response to a hostage-taking in Lebanon? Or had it started in the 1980 campaign with collusion with the Iranians, as the then-president of Iran asserted? Who knew what, and when? And what was George H.W. Bush’s role in it all?
Walsh had zeroed in on documents that were in the possession of Reagan’s former defense secretary, Caspar Weinberger, who all the evidence showed was definitely in on the deal, and President Bush’s diary that could corroborate it. Elliott Abrams had already been convicted of withholding evidence from Congress, and he may have even more information, too, if it could be pried out of him before he went to prison. But Abrams was keeping mum, apparently anticipating a pardon.
So Bush called in his attorney general, Bill Barr, and asked his advice.
Barr, along with Bush, was already up to his eyeballs in cover-ups of shady behavior by the Reagan administration.
Now, just short of two months later, Bush was asking Barr for advice on how to avoid another very serious charge in the Iran-Contra crimes. How, he wanted to know, could they shut down Walsh’s investigation before Walsh’s lawyers got their hands on Bush’s diary?
In April of 2001, safely distant from the swirl of D.C. politics, the University of Virginia’s Miller Center was compiling oral presidential histories, and interviewed Barr about his time as AG in the Bush White House. They brought up the issue of the Weinberger pardon, which put an end to the Iran-Contra investigation, and Barr’s involvement in it.
It turns out that Barr was right in the middle of it.
“There were some people arguing just for [a pardon for] Weinberger, and I said, ‘No, in for a penny, in for a pound,’” Barr told the interviewer. “I went over and told the President I thought he should not only pardon Caspar Weinberger, but while he was at it, he should pardon about five others.”
Which is exactly what Bush did, on Christmas Eve when most Americans were with family instead of watching the news. The holiday notwithstanding, the result was explosive.
America knew that both Reagan and Bush were up to their necks in Iran-Contra, and Democrats had been talking about impeachment or worse. The independent counsel had already obtained one conviction, three guilty pleas, and two other individuals were lined up for prosecution. And Walsh was closing in fast on Bush himself.
So, when Bush shut the investigation down by pardoning not only Weinberger, but also Abrams and the others involved in the crimes, destroying Walsh’s ability to prosecute anybody, the New York Times ran the headline all the way across four of the six columns on the front page, screaming in all-caps: BUSH PARDONS 6 IN IRAN AFFAIR, ABORTING A WEINBERGER TRIAL; PROSECUTOR ASSAILS ‘COVER-UP.’
Bill Barr had struck.
The second paragraph of the Times story by David Johnston laid it out:
Mr. Weinberger was scheduled to stand trial on Jan. 5 on charges that he lied to Congress about his knowledge of the arms sales to Iran and efforts by other countries to help underwrite the Nicaraguan rebels, a case that was expected to focus on Mr. Weinberger’s private notes that contain references to Mr. Bush’s endorsement of the secret shipments to Iran. [Emphasis added]
History shows that when a Republican president is in serious legal trouble, Bill Barr is the go-to guy.
For Safire, it was déjà vu all over again. Four months earlier, referring to Iraqgate (Bush’s selling WMDs to Iraq), Safire opened his article, titled “Justice [Department] Corrupts Justice”:
U.S. Attorney General William Barr, in rejecting the House Judiciary Committee’s call for a prosecutor not beholden to the Bush Administration to investigate the crimes of Iraqgate, has taken personal charge of the cover-up.
Safire accused Barr of not only rigging the cover-up, but of being one of the criminals who could be prosecuted….
Walsh, wrote Johnston for the Times on Christmas Eve, “plans to review a 1986 campaign diary kept by Mr. Bush.” The diary would be the smoking gun that would nail Bush to the scandal.
“But,” noted the Times, “in a single stroke, Mr. Bush [at Barr’s suggestion] swept away one conviction, three guilty pleas and two pending cases, virtually decapitating what was left of Mr. Walsh’s effort, which began in 1986.”
And Walsh didn’t take it lying down.
The Times report noted that, “Mr. Walsh bitterly condemned the President’s action, charging that ‘the Iran-contra cover-up, which has continued for more than six years, has now been completed.’”
Independent Counsel Walsh added that the diary and notes he wanted to enter into a public trial of Weinberger represented, “evidence of a conspiracy among the highest ranking Reagan Administration officials to lie to Congress and the American public.”
The phrase “highest ranking” officials included Reagan and Bush….
Barr successfully covered up the involvement of two Republican presidents—Reagan and Bush—in two separate and perhaps impeachable “high crimes.” And months later, newly sworn-in President Clinton and the new Congress decided to put it all behind them and not pursue the matters any further.
Now, by cherry-picking Mueller’s report and handing Trump the talking points he needed, Barr has done it again.
The question this time is whether Congress will be as compliant as they were in 1993 and simply let it all go.
Both Trump and senior Republican leadership are already calling for a repeat of ’93; what remains to be seen is whether the press and Democratic leadership will go along with a cover-up, like they did back then.
Thom Hartmann is a talk-show host and author of more than 25 books in print. He is a writing fellow at the Independent Media Institute.
Robert Parry also wrote extensively about the Iran Contra Deal and published his collection in several books available on this website. His conclusions were that Bush as head of CIA arranged for the continuing captivity of the 52 American Hostages held in Iran until after the election that Reagan and Bush won. The motive was to deny hero status to President Carter, a proven master negotiator who had accomplished multiple peace treaties between Israeli and Arab nations and organizations, who was a credible threat for the election campaign season is he also secured the release of the American Citizens being held as hostages on foreign enemy soil. Hence the term October Surprise. Bush and Reagan went on to win the election and the media shrugged off the highly suspicious release of all 52 hostages to the minute that Reagan took his oath of office as just evidence that the Iranians were scared of what Reagan might do to secure their release.
This does not address the failed mission to free the hostages called Operation Eagle Claw which failed by flying the rescue helicopters into a sandstorm. Subsequent rescue missions by Carter were also ultimately not conducted. The Iranians without opposing force of arms released the hostages voluntarily within minutes of the end of the Carter administration prompting a Worldwide celebration and exactly zero questions as to the why of what happened.
Truth and Reconciliation Commissions were never a part of the Aftermath of the Iraq War when all the claims of WMD were never found.
The very fact that William Bar now presides over the embattled Trump Presidency doing what he has done many times before which is coverups of official high crimes and misdemeanors committed by republicans should tell you that there will be no Truth and Reconciliation Commission about the aftermath of the Trump Impeachment either.
Sorry to burst your hope bubble but history is clear about the course of politics in America. Donald Trump claimed he could “stand in the middle of Fifth Avenue and shoot somebody” and not “lose any voters.”. With friends like Bill Barr, who doubts this is not true?
It will not happen until US citizens understand what is going on and what has gone on for a long time in American politics.
Like I said, ain’t never gonna happen.