Lying As Policy - Halliburton

April 10, 2007

Halliburton Ends Sanctions-Busting Work in Iran

On Monday, Dick Cheney's one-time firm Halliburton announced it had completed work on past contracts in Iran. That news comes just weeks after the company revealed it would move its Houston headquarters to Dubai in order to escape both American taxes and restrictions on business in the Middle East.
As Perrspectives reported in February, Halliburton had side-stepped the U.S. sanctions regime in place against Iran since the 1990's by using a Cayman Islands subsidiary. And what should come as a surprise to no one, CEO Dick Cheney opposed those very sanctions until, of course, he became George W. Bush's Vice President:
[...]In 2004, the CBS newsmagazine 60 Minutes detailed the Iranian business dealings of Cheney's former company, Halliburton. Despite the prohibitions signed into law by President Clinton with his 1995 executive order and the Iran and Libya Sanctions Act of 1996, Halliburton continued to reap the profits of business with Iran through its non-U.S. subsidiaries. While U.S. law bans virtually all commerce with the rogue nations, Halliburton was able to jump through its major loophole: the rules do not apply to any foreign or offshore subsidiary so long as it is run by non-Americans. As CBS documented:
That subsidiary, Halliburton Products and Services, Ltd., is wholly owned by the U.S.-based Halliburton and is registered in a building in the capital of the Cayman Islands -- a building owned by the local Calidonian Bank. Halliburton and other companies set up in this Caribbean Island, because of tax and secrecy laws that are corporate friendly.
Halliburton is the company that Vice President Dick Cheney used to run. He was CEO from 1995 to 2000, during which time Halliburton Products and Services set up shop in Iran. Today, it sells about $40 million a year worth of oil field services to the Iranian government
In the wake of the January 2004 60 Minutes piece, the company moved quickly to declare that "Halliburton's business in Iran is clearly permissible under applicable laws and regulations" and cited its October 2003 disclosures to the New York City police and fire pension funds. Despite those assurances, Dick Cheney's old firm was subpoenaed by a U.S grand jury in June 2004. In early 2005, Halliburton announced that it would end its business activities there when it fulfills its ongoing contracts, including a $35 million gas drilling project it had just won the previous month.
Though he does not benefit directly from the Iran contracts of Halliburton's foreign-based subsidiaries, Cheney continues to have financial ties to his former firm. Despite Cheney's assurances that "I've severed all my ties with the company, gotten rid of all my financial interest," a 2003 report by the Congressional Research Service found that the Vice President retained 433,000 shares of Halliburton. In addition, Cheney received $162,392 and $205,298 in deferred payments in 2001 and 2002, respectively.
Given the stakes, it's no wonder Dick Cheney had a born-again experience on Iranian sanctions when he entered the Bush administration. While Vice President, Cheney in 2002 denounced Iran as "the world's leading exporter of terror." But during his tenure as Halliburton CEO in the 1990's, Cheney strenuously argued against Clinton's sanctions regime and expanded Halliburton's business with Tehran. But in 1998, he complained that U.S. firms were "cut out of the action." And back in 1996, Cheney railed against the Clinton prohibitions on Iranian trade and financial activity for American firms:
"We seem to be sanction-happy as a government. The problem is that the good Lord didn't see fit to always put oil and gas resources where there are democratic governments."
When it comes to disinvestment in Iran, Republicans like Mitt Romney and Dick Cheney shouldn't, to paraphrase then-candidate George W Bush, "take the high horse and then claim the low road." The task of decrying those who unwittingly provide aid and comfort to the Iranian regime is best left to those who are sincere about it, such as Oregon Senator Ron Wyden. In 2005, Wyden in reaction to the Halliburton's cozy relationship proposed a bill to require the Treasury Department to publicly list both foreign firms doing business with Iran's energy interests as well as any U.S entities holding more than a $100,000 stake in them. And just last month, Wyden introduced the "Stop Arming Iran Act" to ensure that surplus parts and components from retired American F14 fighter jets are not auctioned off to arms dealers serving the government in Tehran[...]
For more background, see "Romney and Cheney in Deep with Iran Investments."