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BP and its bosses sued over alleged bribery of officials

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Lord Browne and Tony Hayward

Daily Telegraph: BP and its bosses sued over alleged bribery of officials

By James Quinn
Last Updated: 12:31am BST 11/04/2008

Hayward and Browne named in action that claims millions of dollars were handed out in return for licences. James Quinn reports

British oil giant BP, Tony Hayward and Lord Browne of Madingley have been named in a multi-million dollar lawsuit involving allegations of bribery of government officials in Kazakhstan.

The company and its current and former chief executives are just three of the defendants named in a wide-ranging lawsuit alleging that money changed hands to win oil and gas licences in the former Soviet state. Other defendants include BG Group and chief executive Frank Chapman, as well as Norway’s Statoil and its chief executive, Helge Lund.

The suit has been filed by Grynberg Production Corporation, a Denver-based oil company owned and run by chairman Jack Grynberg.

The core allegation is that the defendants, without Grynberg’s knowledge, bribed officials in Kazakhstan to win oil rights from joint ventures in which Grynberg had an interest.

The 27-page lawsuit, a copy of which has been seen by The Daily Telegraph, accuses the defendants of violating the United States’ Racketeer Influenced and Corrupt Organisations (RICO) Act, of conspiring to break the RICO Act, of common law fraud, of theft, and breaching constructive trust. Grynberg is claiming damages in excess of $6m (£3m).

Grynberg began working in the Kazakh region in November 1990, signing partnership agreements with the defendants in a bid to take advantage of the untapped resources onshore and offshore in the north-west of the former Soviet state. However, Mr Grynberg claims that he did not know that the defendants were involved in allegedly channelling some of his money from the various joint ventures to bribe Kazakh officials in order to win specific licences.

The case centres on American businessman James Giffen, who is awaiting trial in the US on charges of conspiracy to commit fraud and to violate the Foreign Corrupt Practices Act. Mr Giffen is alleged to be at the centre of a conspiracy to bribe Kazakh officials and cover up those bribes.

Grynberg alleges that the defendants paid about $12m between them of the illicit bribes attributed to certain of Mr Giffen’s activities.

Mr Grynberg told The Daily Telegraph he was bringing the case because he did not want to be pursued by the Department of Justice (DoJ) on bribery charges.

“Unless I assert that I was an unwilling participant in this, my neck could be on the line. I’m too old to go to prison,” said 76-year-old Mr Grynberg, who believes the minimum federal sentence in such a situation would be five years and a $1m fine.

This is the second such case filed by Mr Grynberg against BP in recent weeks. BP and Lord Browne were named in a suit alleging bribery of government officials in Grenada.

One report suggested that the oil veteran had brought more than 73 separate lawsuits against rivals in his industry. Mr Grynberg admits that he is litigious, but claims that he has a 98pc success rate in court actions.

The new case was first filed at the US District Court in February. Grynberg’s solicitor, Dan Abrams, is understood to have served the suit at BP’s North American offices on BP and the current and former executives named. Statoil would only accept the suit for itself, not its executives. BG’s North American operations refused to accept the serving of the suit.

Spokesmen for BP and BG both declined to comment. A spokesman for Statoil said the suit was completely unfounded. and its also non-profit sister websites,,,,, and are all owned by John Donovan. There is also a Wikipedia article.

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