The news media and pundits were too entranced by Anthony Weiner’s package, the royal baby, whatever it was, and President Obama’s third or fourth promise to make the economy his primary focus every waking hour between fundraisers and expensive junkets to notice that the old villain of the Left, Halliburton, once again got away with corporate villainy of the worst kind. You see, Halliburton executives engaged in ethics accounting, essentially balancing the possible penalties that might arise from illegal and unethical conduct against the benefits, and decided, sure, let’s destroy evidence that shows that Halliburton had more to do with the deadly and ecologically devastating Deepwater Horizon explosion that created the Gulf oil spill than regulators and the courts currently know.
The company’s crime—remember, Scooter Libby was sent to jail for obstructing justice regarding the investigation of a crime that didn’t exist—was discovered, so it made a sweet deal with the Justice Department: it agreed to pay the maximum allowable fine of $200,000 ( perspective: this would be considered a joke of a fine for steroid use by a major league baseball star) and will be subject to a three year probation; the company continue its cooperation with the government’s criminal investigation (which is its duty anyway), and to really show its contrition and yummy goodness, Halliburton made a voluntary contribution of $55 million to the National Fish and Wildlife Foundation to clean off those oil-covered sea birds and otters, and that kind of thing.
Disgraceful and outrageous. This is why white collar crime continues, and why Americans don’t know what, if any, corporations to trust. The 2010 Gulf of Mexico oil spill killed 11 people and poured nearly 5 million barrels of oil offshore, ruining the economy of a region, destroying wildlife, and devastating the lives and livelihoods of thousands of Americans. Halliburton confesses that employees twice erased computer simulations that proved the company’s claims about the causes of the disaster (“It was all Transocean’s and BP’s fault!”) were false. The grand penalties for the same kind of conduct that led the Bush Justice Department to put Arthur Andersen out of business were:
- A $200,000 fine, or just under four minutes’ revenue for the company.
- A $55 million charitable, tax-deductible contribution to the National Fish and Wildlife Foundation that the company should have made anyway.
And that’s it. Meanwhile, the Halliburton manager who instructed two colleagues to destroy computer simulations that would have been evidence in the oil spill investigation hasn’t been identified by the company and is still employed. He probably got a bonus.
The Washington Post interviewed J. Kelly Strader, a law professor at Southwestern Law School, who correctly pointed out that destruction of evidence often leads to multiple felony counts, including obstruction of justice, as it did in the case of Enron. “Given the scale of the harm caused by the oil spill, it seems surprising that the government would accept a plea to a relatively minor charge,” he said. Surprising? Watch where Halliburton’s next round of campaign contributions go.
Halliburton said Justice agreed to not pursue any charges beyond the misdemeanor in return for “cooperation.” Not to be cynical, but this is Eric Holder’s Justice Department we are talking about.
Last week, Halliburton’s stock closed at $45.98, up 3.7 percent.
The government can’t put corporations in prison, so it makes these kinds of corrupt deals that essentially allow companies to make paying criminal fines a cost of doing business. It could indict individual executives, but seldom does. Halliburton spokeswoman Susie McMichael said, when asked about whether anyone in the management chain was in jeopardy, “We have no reason to believe that the DOJ intends prosecution of any of them.”
If upper level corporate management knew that the laws would hold them responsible for crimes committed by those under their supervision and whose ethical training and conduct they were ultimately responsible for overseeing and enforcing, and that they would be forced to exchange their thousand dollar tailored suits for orange ones, you can bet that there would be a serious, concerted, no-tolerance approach to business ethics rather than what is now too often a check box, wink-wink, “We at [Fill in the blank] make ethics, integrity, good corpoate citizenship and accountability our highest priorities” sham.*
Until that is how the Justice Department and law enforcement deals with Halliburton and the rest, the corporate America will continue to be inherently untrustworthy…and dangerous.
*Of course, the current government itself rejects that principle: the Chief Executive refuses to acknowledge responsibility for criminal misconduct done for his benefit by a powerful agency in the executive branch.
Graphic: This is AFL