There's More...NEW YORK (Reuters) - Pentagon auditors have concluded that Halliburton Co. failed to adequately account for more than $1.8 billion of work in Iraq and Kuwait, the Wall Street Journal said on Wednesday, citing a Pentagon report.
The amount represents 43 percent of the $4.18 billion that Houston-based Halliburton's Kellogg Brown & Root unit has billed the Pentagon to feed and house troops in the region, the newspaper said.
It said the findings in the 60-page Pentagon audit report, dated Aug. 4 but not publicly released are likely to increase pressure on the U.S. government to withhold hundreds of millions of dollars of payments to Halliburton.
According to the newspaper Halliburton has until Sunday, after two prior extensions, to provide Army officials with all necessary cost information for its logistical work in Iraq and other locales.
This could lead to the withholding of as much as $600 million of payments, though KBR officials are confident the Army will again extend the deadline, and the Army is considering doing so, it said.
Halliburton shares closed on Tuesday at $29.83 on the New York Stock Exchange.
There's more...DALLAS (AP) - Four former employees claim that Halliburton Co. engaged in systematic accounting fraud, according to a filing in a class-action lawsuit against the oilfield-services giant.
The fraud allegedly occurred from 1998, when Vice President Dick Cheney ran Halliburton, to 2001. Cheney, who left Halliburton in August 2000, was not named as a defendant in the filing.
The former finance employees say that Halliburton divisions routinely inflated their results by overstating amounts due from customers and understating money owed to vendors.
The four employees charged that Halliburton and its top executives "intentionally engaged in serial accounting fraud."
The filing claims that in late 2001 Halliburton executives misled investors about the company's liability to pay asbestos-related claims. The executives did not disclose for 10 weeks that the company had been ordered to pay a $130 million verdict in Texas - when the case did become public knowledge, Halliburton shares fell 42 percent in one day.
Houston-based Halliburton inherited many of the asbestos claims through a 1998 acquisition of rival Dresser Industries, one of Cheney's main accomplishments as chairman and CEO.
Wendy Hall, a spokeswoman for Halliburton, said the verdict wasn't disclosed sooner because the company it would be reversed on appeal and that insurance would cover the claims anyway.
Hall also rejected the allegations that Halliburton systematically overstated billings and understated costs. She said the company had a toll-free hotline for employees to report concerns about business practices, but that there were no records of any complaints matching those in the court filing.