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In the Matter of Baker Hughes Incorporated

 
:
Baker Hughes - Baker Hughes Inc.
:
SEC Civil
:
September 12, 2001
:
In the Matter of Baker Hughes Incorporated
:
In the Matter of Baker Hughes Incorporated, SEC Administrative Proceeding File No. 3-10572 (2001)
:
Energy (Non-Utility)-Oil & Gas-Other/Multi
:
Brazil, India, Indonesia
:
1995; 1998; 1999
:
1) Indonesian tax official representing the Directorate General; 2) undisclosed Indian official; and 3) undisclosed Brazilian official.
:
On September 12, 2001, the S.E.C. instituted a settled administrative proceeding against Baker Hughes Incorporated ("Baker Hughes"). The Commission's order finds that, in March 1999, Baker Hughes's CFO, Eric Mattson, and its Controller, James Harris, authorized an illegal payment, through KPMG Siddharta Siddharta & Harsono, its agent in Indonesia, to a local government official in Indonesia. The payment, amounting to $75,000, was allegedly intended to influence an Indonesian tax official to reduce a tax assessment for PT Eastman Christensen ("PTEC"), an Indonesian company beneficially owned by Baker Hughes, from $3.2 million to $270,000.

To conceal the allegedly improper payment, Harsono allegedly authorized KPMG-SSH to generate an invoice that included $75,000 for payment to the Indonesian tax official and $68,000 for KMPG-SSH's fees for services rendered and applicable taxes.

The Order also finds that in 1995 and 1998, senior managers at Baker Hughes authorized payments totalling $10,000 and $15,000 to Baker Hughes' agents in Brazil and India, respectively, without making an adequate inquiry as to whether the agents might give all or part of the payments to foreign government officials in violation of the FCPA.

Without admitting or denying the Commission's findings, Baker Hughes consented to the entry of the Commission's Order directing Baker Hughes to cease and desist from commiting or causing any violation and any future violation of the internal controls and book and records provisions of the Exchange Act.
:
Books and records (Issuer), Internal controls (Issuer)
:
Injunction/Cease and desist
:
Baker Hughes consented to a cease-and-desist order that forbid future violations of the internal controls and books and records provisions of the Exchange Act, but was not subject to a financial penalty.
:
Not stated.
:
0
:
Issuer
:
U.S.
:
License/Permit, Tax
:
Not stated.
:
Wire/check
:
Customs Broker or Agent/Consultant
:
100,000
:
Brazil, India, Indonesia
:
No