Feds sue former oil executive, settle with drilling company over alleged bribes in Venezuela

Feds pursue claims of US oil bribes in Venezuela

DALLAS — The federal government is suing a former U.S. oil executive and settled another case with a drilling company, both over alleged bribes involving lucrative oil contracts in Venezuela.

The Securities and Exchange Commission accuses Bobby Benton of concealing $384,000 in payments to Venezuelan oil officials to secure extensions of three drilling contracts from 2003-05 when he was a vice president for Houston-based Pride International Inc.

The civil lawsuit filed in December in federal court in Houston also alleges that Benton knew of $35,000 in improper payments to Mexican customs officials to ensure delivery of drilling supplies to Latin America.

Benton faces anti-bribery violations and falsification of records claims under the federal Foreign Corrupt Practices Act. In a written response to the lawsuit, Benton invoked his Fifth Amendment right against self-incrimination on most of the claims.

An attorney for Benton didn’t immediately return a phone call seeking comment Monday.

According to the lawsuit, Benton redacted references to payments to the state oil company Petroleos de Venezuela SA, or PDVSA, in response to an internal audit. The suit also claims Benton signed false certifications in connection with Pride’s 2004 and 2005 financial reports.

“But for Benson’s false statements, Pride’s management and internal and external auditors would have discovered the bribery schemes and the corresponding false books and records,” the lawsuit said.

Pride spokeswoman Kate Perez said the company couldn’t comment on the lawsuit against Benton, who left in 2006. Pride is “engaged in discussion” with federal officials over claims of bribes, Perez said.

Pride International Chief Executive Louis Raspino said in a regulatory filing that the company had set aside $56.2 million for a possible settlement.

A representative for PDVSA did not immediately respond to a request for comment.

Another drilling company, Helmerich & Payne Inc. of Tulsa, Okla., agreed in July to pay $1.38 million in fines to the Justice Department and the SEC over claims of more than $170,000 in improper payments to customs officials in Venezuela and Argentina.

Helmerich & Payne also agreed to review its internal controls and report to the government periodically over two years.

The U.S. government said Helmerich & Payne officials made the payments from at least 2003 through 2008 to import and export goods that were not within regulations and to avoid higher taxes on goods.

An attorney for Helmerich & Payne didn’t immediately return a phone call seeking comment.

Venezuelan President Hugo Chavez has increased state control of the country’s oil industry, which funds nearly half his government’s budget, and has nationalized oil projects previously managed by private companies under contract. Yet PDVSA has also continued to contract with oil service companies, some of them based in the U.S., as it seeks expertise and investment from multinationals to develop its heavy crude.

The OPEC nation has long had corruption problems. Last year, the organization Transparency International ranked Venezuela near the bottom of its list of 180 nations and territories, based on surveys of experts and businesspeople about corruption. Venezuela came in at 162.

Chavez’s government has dismissed such rankings as biased.

A third company — Alvin, Texas-based Team Industrial Services — said in a regulatory filing that the it self-reported allegations of improper payments to government officials in Trinidad.

The oilfield services company said improper payments totaling less than $50,000 didn’t extend beyond the small island country off the coast of Venezuela. However, the company said it could face sanctions from the U.S. government, including possible fines.