Kerry campaign: Release Cheney's Halliburton testimony
Lawyer says vice president's conduct 'proper in all respects'
WASHINGTON (CNN) -- Democratic presidential candidate John Kerry's campaign Wednesday called on the White House to release details of Vice President Dick Cheney's testimony in federal regulators' probe of the accounting practices of the company he once headed.
Oil services giant Halliburton agreed to pay $7.5 million for failing to disclose a change in its accounting practices that occurred in 1998 and 1999, when Cheney was the company's CEO, the Securities and Exchange Commission and the company said Tuesday. Cheney was not charged in the matter.
The accounting change resulted in public statements the SEC called "materially misleading," and boosted the company's reported pre-tax income in one quarter by as much as 46 percent. (Full story)
"The American people already have serious concerns about the Bush-Cheney administration giving Halliburton $7 billion in no-bid Iraq contracts," Kerry campaign spokesman Chad Clanton said in a press release.
"These new reports about accounting gimmicks at Halliburton while Cheney was CEO only reinforce those concerns. It's no wonder people think this White House has trouble with the truth and lacks credibility."
The Bush-Cheney campaign referred comment to Cheney's lawyer, Terry O'Donnell. He referred questions to the SEC.
Cheney submitted testimony to the SEC this week, O'Donnell said in a statement issued Tuesday.
O'Donnell said Cheney was not involved in the accounting change or its disclosure and that his conduct "was proper in all respects."
SEC investigator Spence Barasch said his agency could not release or comment on Cheney's testimony because a case is pending against former Halliburton Chief Financial Officer Gary Morris, who was with the company at the time of the alleged violations.
Kerry's campaign noted that Bush has criticized CEOs who mislead their shareholders, a frequent refrain in the president's campaign stump speech.
The Kerry campaign issued a statement with a list of questions for the White House, including when and where Cheney's testimony was taken, what investigators asked Cheney, whether he was asked to turn over any documents, and whether he invoked his Fifth Amendment right against self-incrimination at any point.
Cheney ran the Dallas-based company from 1995 until August 2000, when he resigned to run for vice president. The company admitted no wrongdoing in its settlement with the SEC.
The SEC investigation focused on a change in accounting practices at the company that began in the second quarter of 1998.
At that time, Halliburton began recognizing offsetting losses through estimated probable recoveries on claims that had not been resolved with customers, the SEC said. Before that, it had offset the losses only after they had been resolved.
Though both practices are considered appropriate under generally accepted accounting principles, "the new practice reduced losses on several large construction projects," an SEC statement said.
"As a result, Halliburton's reported income was higher under the revised practice than it would have been under the prior practice," the statement said.
Halliburton executives did not disclose the change until March 2000, the SEC said.
Halliburton has received U.S. government contracts valued in the billions to support reconstruction efforts in Iraq.
The Pentagon is investigating whether the company overcharged for the fuel delivered to Iraqi civilians, and its Kellogg, Brown and Root subsidiary agreed to refund $27 million for potential overbillings at military dining halls in Iraq and Kuwait.
Cheney's office repeatedly has denied that the vice president had any role in securing government contracts for his former company.
In June, witnesses said Cheney blurted an obscenity at Democratic Sen. Patrick Leahy of Vermont -- who has called for an investigation into whether the vice president intervened on Halliburton's behalf -- during a photo session on the Senate floor.
Cheney said later that Leahy "had challenged my integrity" and he did not regret his comment.
CNN's Elaine Quijano contributed to this report.
