The corruption cases databases are a product of the staff of the International Bank for Reconstruction and Development / The World Bank. It is intended for general information purposes only. The findings, interpretations, and conclusions expressed in the Database do not necessarily reflect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. Neither the World Bank Group nor its officers or employees shall be liable for any losses that may result directly or indirectly from the use of or reliance upon such information.
Faliure to Maintain Books and Records, Internal Controls Violations
No admission or denial of alleged offenses
According to the US Securities and Exchange Commission Litigation Release, the Commission filed a settled complaint on February 7, 2007, which alleged "that from approximately June 2001 through June 2002, El Paso, and its predecessor in-interest The Coastal Corporation, indirectly made approximately $5.5 million in illegal surcharge payments to Iraq in connection with its purchases of crude oil from third parties under the U.N. Oil for Food Program. The Program was intended to provide humanitarian relief for the Iraqi population, which faced severe hardship under international trade sanctions. However, beginning in August 2000, officials of Iraqi State Oil Marketing Organization, began demanding illegal kickbacks. The kickbacks were made in the form of surcharges, and were sent to Iraqi-controlled accounts at banks in Jordan and Lebanon. [ ] El Paso, without admitting or denying the allegations in the Commission's complaint, consented to the entry of a final judgment permanently enjoining it from future violations of Sections 13(b)(2)(A) and 13(b)(2)(B) of the Securities Exchange Act of 1934, ordering it to disgorge $5,482,363 in profits, and to pay a civil penalty of $2,250,000. El Paso will satisfy its disgorgement obligation by forfeiting $5,482,363 pursuant to a non-prosecution agreement with the U.S. Attorney's Office for the Southern District of New York." (Source: US Securities and Exchange Commission Litigation Release No. 19991 / February 7, 2007, Securities and Exchange Commission v. El Paso Corporation, Civil Action No. 07CV00899 (S.D.N.Y.), "SEC Files Settled Books and Records and Internal Controls Charges Against El Paso Corporation For Improper Payments to Iraq Under the U.N. Oil for Food Program - - Company Agrees to Pay $7.7 Million.") Please note that the Disgorgement penalty has not been noted in this entry as it is already noted in the El Paso criminal case settlement.
US Securities and Exchange Commission Litigation Release No. 19991 / February 7, 2007, Securities and Exchange Commission v. El Paso Corporation, Civil Action No. 07CV00899 (S.D.N.Y.), "SEC Files Settled Books and Records and Internal Controls Charges Against El Paso Corporation For Improper Payments to Iraq Under the U.N. Oil for Food Program - - Company Agrees to Pay $7.7 Million," accessed at http://www.sec.gov/litigation/litreleases/2007/lr19991.htm; Complaint filed February 7, 2007, accessed at http://www.sec.gov/litigation/complaints/2007/comp19991.pdf
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