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Mired in Corruption-Kellogg, Brown & Root in Nigeria

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samantha marcelle

on 18 November 2013

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Transcript of Mired in Corruption-Kellogg, Brown & Root in Nigeria

Question 2
Irrespective of the legality of any payments that Tesler may have made, do you think it was reasonable for KBR to hire him as an intermediary?
No, it was not reasonable for KBR to hire Tesler as an intermediary.
This is so because:-
Tesler had long-standing relations with the Nigerian government and officials
Kellogg had a relationship with Tesler
Question 4
Should KBR have walked away from the Nigerian LNG project once it became clear that the payment of bribes might be required to secure the contract?
Mired in Corruption-Kellogg, Brown & Root in Nigeria
Group Members: Aalim Wells
Anastasia Modeste
Britney Peru
Jamir Kanhai
Nicholette Thurton
Samantha Marcelle

Question 1
Could Jeffery Tesler's alleged payments of bribes to Nigerian Officials be considered "facilitating payments" or "speed money" under the terms of the Foreign Corrupt Practices Act?
Question 3
Given the known corruption of the Abacha government in Nigeria, should Kellogg and its successor, KBR, have had a policy in place to deal with bribery and corruption? What might that policy have looked like?
Analysis
Distinction between facilitating payment and speed money under the FCPA.

Facilitating Payment- speeding up transactions or procedures for example paper work, government services and mail delivery.

Speed Money- the use of a valuable item for example cash in exchange for consideration for contracts or business deals
Answer
Jeffery Tesler's actions were indeed "speed money" based on two reasons
transferring $2.5 million into Dan Etete account.

formally written notes from Kellogg's former executive recommending the bribe.
Answer
Yes, they should have

KBR's Code of Business Conduct
-Commercial Bribery
-Ethical Business Practices

Would the end justify the means?
-$40 million criminal fine
-Albert Stanley sentenced to 30 months

Question 5
There is evidence that Jack Stanley, the former head of M.W. Kellogg and KBR, may have taken kickback payments from Tesler. At least one other former Kellogg employee, Wojciech Chodan, may have taken kickback payments. What does this tell you about the possible nature of the ethical climate at Kellogg and then KBR?
Question 6
Should Halliburton be called to account if it is shown that its KBR unit used bribery to gain business in Nigeria? To what extent should a corporation and its officers be held accountable for ethically suspect activities by the manager in one of its subsidiaries, particularly given that many of those activities were initiated before Halliburton owned the subsidiary?
Answer
Answer
Answer
Yes they should be held liable based on these conditions:
 Being the parent company they are responsible for controlling the operations within the subsidiary.
 Executive members were aware of the issue.
 The company distanced themselves from the actual bribe by hiring a third party.

Also we believe that Halliburton should be held fully responsible for their subsidiary’s unethical practices even though some were initiated before their ownership.







Cont'd
Answer
Yes, they should have had a policy
- Introduction
- Kellogg’s Policy on Bribery and Corruption
- Understanding bribery and corruption
- Recognizing Bribery and Corruption
- Key risk areas
- Penalty
Dick Cheney
Albert 'Jack' Stanley
Jefferey Tesler
Sani Abacha
Full transcript