Edited by Stephen Tully
Gemma Aiolfi and Mark Pieth Introduction In September 2003 the shares of Statoil, the Norwegian oil company, took a beating: over a three-week period the value of the shares fell by 11 per cent, whereas the crude oil price had declined by only 2 per cent in the same time span. The cause of this unexpected price drop was the revelation that the company was possibly implicated in bribery in its international business dealings. The news reports allege that Statoil had signed a contract for advisory services with an Iranian intermediary, named M.H. Rafsanjani, the son of the former Iranian president. The contract provided for a $15 million fee to be paid over an 11-year period. The Norwegian financial crime police announced that a payment of $5.2 million of Statoil money had wound up in an account in the Turks and Caicos Islands belonging to a consulting company registered in the UK (Horton Investment) and which appears to have been used in the transaction. The services that the Iranian consultant was supposed to render included supplying information on social developments in Iran, but the whistle was blown by internal audit staff at Statoil, with the resulting furore in the world press. Within two weeks the chief executive officer of Statoil, the chairman, and the head of exploration, all resigned from their posts. It would appear that once this had happened, the share price began to recover, although it took until mid-December 2003 for the price to regain its September level....
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