The New York Times: Shell Settles Oil Reserve Fraud Case for $150.7 Million: Degenhardt added that the overstatements had occurred ``over an extended period.'' (ShellNews.net)
Posted 25 August 04
LONDON (Reuters) - Regulators said on Tuesday they would pursue individuals responsible for a reserves scandal at Royal Dutch/Shell Group (RD.AS) (SHEL.L), as the oil giant settled $151 million in fines over the debacle.
``As our investigation continues, we intend to focus on, among other things, the people responsible for Shell's failures,'' said Harold F. Degenhardt, administrator at the Securities and Exchange Commission (SEC) in the United States.
Degenhardt added that the overstatements had occurred ``over an extended period.'' The SEC added that it had warned Shell before late 2003 that its ``reported proved reserves potentially were overstated.''
Meanwhile, the UK's Financial Services Authority (FSA) said it was continuing ``investigations into other aspects'' of the reserves scandal.''
The world's third-largest oil company agreed on Tuesday to finalize settlements with both U.S. and UK regulators over its misstatement of proven oil reserves. Shell will pay the FSA 17 million pounds ($31 million) and the SEC $120 million.
The settlement comes after Shell stunned financial markets in January by slashing its proven oil and gas reserves by a fifth, or 4.47 billion barrels.
The FSA said Shell's ``unprecedented misconduct'' resulted in market abuse and the breaching of listing rules.
Shell said it will also spend an additional $5 million to develop and implement a ``comprehensive internal compliance program'' as part of its deal with the SEC. It said it has improved its systems to prevent ``any recurrence of these unfortunate events.''
Several top Shell executives lost their jobs in the wake of the scandal. Shell's new board, led by Chairman Jeroen van der Veer and managing director Malcolm Brinded, has slowly won shareholders over with promises to improve corporate governance.
Earlier this month, a senior industry source told Reuters that Shell would unify the boards of its Dutch and British holding companies. The group might even consider a full merger of the two, or for one holding company to take over the other.
The company currently has two boards. Royal Dutch owns 60 percent of the overall group, while Shell Transport & Trading holds the remaining 40 percent.
Shell has said it will publish the results of its corporate governance review in November, and that nothing had been ruled out.
http://www.nytimes.com/reuters/business/business-energy-shell.html