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Leaked Emails Reveal Widespread Corruption in Global Oil Industry (theage.com.au)
Nick McKenzie, Richard Baker, Michael Bachelard, and Daniel Quinlan report on a widespread corruption in the global oil industry for The Huffington Post: In the list of the world's great companies, Unaoil is nowhere to be seen. But for the best part of the past two decades, the family business from Monaco has systematically corrupted the global oil industry, distributing many millions of dollars worth of bribes on behalf of corporate behemoths including Samsung, Rolls-Royce, Halliburton and Australia's own Leighton Holdings. A massive leak of confidential documents has for the first time exposed the true extent of corruption within the oil industry, implicating dozens of leading companies, bureaucrats and politicians in a sophisticated global web of bribery and graft. After a six-month investigation across two continents, Fairfax Media and The Huffington Post can reveal that billions of dollars of government contracts were awarded as the direct result of bribes paid on behalf of firms including British icon Rolls-Royce, US giant Halliburton, Australia's Leighton Holdings and Korean heavyweights Samsung and Hyundai.
Here's your oil stock dividends, Captain Renault....
General Relativity: Space-time tells matter where to go; Matter tells space-time what shape to be.
Bribes in some countries are required "business expenses". They are required, because to not include them prevents deals. The fact that the US outlaws this practice doesn't stop those countries from expecting it. It is how you get it soccer in Qatar (Thanks FIFA!) Pay enough tot he right people, and shit gets done.
Which is pretty much the opposite of the US, where you pay government huge amounts of money to have shit stopped up and prevented, we call them Campaign Contributions, or donations to ExPresidents (and presidential candidate) "Foundation" and they are perfectly legal .
Why do we act shocked? Because we're simply ignorant of how the real world actually works.
Agent K: A *person* is smart. People are dumb, stupid, panicky animals, and you know it.
I'm not surprised at all. To play in most Middle East countries requires a local company and a physical office. This can be hard to set up for foreigners due to local law. Certain countries basically require kickbacks and bribes to get anything done. Legitimate companies often get around both of these issues by partnering with a "facilitator" company.
The Facilitator company will sometimes act as the agent (sales representative) for the legitimate company, collecting a commission on goods and services sold. The commission may be deliberately higher than normal in order to have the cash to pay whoever needs to be paid. This can be discovered by examining the commission amount/percentage and comparing it to other parts of the world for similar services. The foreign company can be held responsible if it knew, or should have known, that something fishy was going on.
Another way to do the same thing is to retain such a company for consulting services. Looking at contract deliverables and the contract amount usually gives an indication if the consulting services are legitimate or a cover for something else. Again, the foreign company can be held responsible if they knew, or should have known that something was up.
Yet another way to do the same thing is to subcontract to one of these facilitating companies. The facilitating company then marks up the price to whatever they need in order to pay their sales staff, pay bribes, or negotiate legal hurdles. The customer's contract is between the customer and the facilitating company, and the foreign company never sees it. Done right, the foreign company has no idea what the final customer price is, or if it was reasonable, etc. This is the best way to protect a foreign company since any improper or illegal actions that the facilitating company takes fall solely on the facilitating company. The facilitating company can also accept contract provisions that a foreign company could not legally accept (Israeli goods boycott, as an example). The foreign company never has the information required to see that something was amiss, so proving that they "knew or should have known" is substantially harder.
One last thing to keep in mind is that certain types of payments are actually legal. Generally, you can pay someone to "hurry up" and complete something that is included in their official duties, and which they would have done for you anyway without the payment. If the payment is just to expedite something that would have happened anyway, it is not considered a bribe, even if it is paid directly to an individual. The prime example of this is paying a customs officer to release cargo which has all the correct paperwork. The officer would have done this anyway, eventually. The payment is just to expedite the legal and inevitable action.
Even those who arrange and design shrubberies are under considerable economic stress at this period in history.
Former Vice President Dick Cheney, who at the time referenced in the leaked documents was CEO of Halliburton. Oh, he is also a war criminal.
"He took a duck in the face at 250 knots." -- William Gibson, Pattern Recognition
What if everybody had the attitude of "well, this is a screwed-up world we live in, what can you do, (nothing), let's turn to the sports" about everything?
"King George wants us to suffer taxation without representation, surprise, surprise, well, duh." - there'd be no America.
"Big deal, this stuff happens, no need for major efforts to change" was the attitude of all those Bishops and Cardinals to kids getting buggered.
We SHOULD react with shock and disgust to lying and fraud in the financial industry, to corruption in oil, to military vendors promoting war; we should tell our politicians they're unemployed unless they act and can have all the money they need to sic 10,000 FBI agents on them.
The S&L crisis in the 80's prompted the assignment of 1000 FBI agents to the case. They brought in about one conviction each: 1000 convictions, a 90% success rate, after winnowing down 30,000 referrals to 1100-odd trials. It brought about real results.
By contrast, the 2008 crisis prompted no such effort despite being 70X as large a set of frauds.
We can tackle these large problems; you just put out the same effort you'd put into a new highway interchange or skyscraper: $100M budget per year and a few thousand people working on it. The US Justice System has nearly one million employees; only 2300 on white-collar crime.