Tulsa World: Helmerich & Payne pays almost $1.4 million in fines after internal customs probe

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Helmerich & Payne pays almost $1.4 million in fines after internal customs probe

By ROD WALTON World Staff Writer
Published: 7/30/2009 5:42 PM
Last Modified: 7/30/2009 5:42 PM

Tulsa contract drilling firm Helmerich & Payne Inc. was hit with nearly $1.4 million in federal fines after revealing that subsidiary employees improperly paid Argentina and Venezuela customs officials to move its rig equipment without required certifications or inspections, according to reports filed Thursday. The company hired outside accountants and lawyers to lead its own investigation after another employee disclosed the alleged violations during Foreign Corrupt Practices Act training sessions, officials said. Helmerich & Payne has fired the employees directly responsible for making the payments. “We timely and voluntarily reported the results of our investigation,” company general counsel Steve Mackey said. “It was the right thing to do.” The penalty is part of a cease and desist order from the U.S. Securities and Exchange Commission. The SEC filing indicated that a Helmerich & Payne subsidiary paid $166,000 to Argentinian officials to avoid more than $186,000 in import and export costs. The company also was accused of paying nearly $20,000 to Venezuelan customs officials for relaxing inspection standards, according to reports. The payments were uncovered as part of a Helmerich & Payne probe into the subsidiaries’ payment practices started in early 2008. “The internal investigation uncovered 50 improper payments to government customs officials in Argentina and Venezuela from 2003 through 2008,” the SEC report reads. “In Argentina, the nature of the improper payments was disguised in invoices by using vague-sounding line items.” Helmerich & Payne’s settlement will pay $1 million in a civil penalty to the U.S. Department of Justice. The SEC will receive $375,000 in other fines. “There are no criminal charges involved in the settlements and disciplinary action has been taken by the company with respect to certain employees involved in the matter, including in some cases, termination of employment,” Helmerich & Payne’s own SEC filing reads. “ Both settlements recognize the company’s voluntary disclosure, cooperation with both agencies, and its proactive remedial efforts.” Neither the federal action nor the company’s alleged investigation were discussed during Helmerich & Payne’s earnings conference call earlier in the day. Company officials did talk about their payment impasse with Venezuela over rig contracts there. By ROD WALTON World Staff Writer

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Reader comments for this story have been moved to the most updated version of the story, now under the headline "H&P draws $1.4 million fine," which was published on 7/31/2009. So far, 9 comments have been made.