by John Donovan of royaldutchshellplc.com
Soon after Sir Phillip Watts was escorted by security guards from the Shell Centre in humiliation and disgrace as a result of his leading role in the Royal Dutch Shell securities fraud, Shell directors appointed Jeroen van der Veer to replace him.
This was despite the fact that van der Veer and fellow Royal Dutch Shell Group Managing Director, Malcolm Brinded, “only narrowly avoided being sacked over their role in the oil giant’s reserves scandal.” Both had signed Form 20F Declarations submitted to the U.S. Securities & Exchange Commission containing materially false information. Both were subsequently co-defendants in a U.S. class action lawsuit settled by Shell in which Royal Dutch Shell, as part of the multi-million dollar settlement, made a range of commitments about future governance of the oil giant.
Van der Veer subsequently became the first Chief Exective Officer of the unified company which emerged from the ashes: Royal Dutch Shell Plc.
Not content with appointing one CEO tainted by fraud, deception and mismanagement, the successor to van der Veer (retiring as CEO in June), is Shell CFO Peter Voser, a Swiss national who for a number of years has been a non executive director of the Union Bank of Switzerland. UBS is the scandal hit Swiss bank recently fined $780 million dollars by U.S. authorities following a criminal investigation by the U.S. Justice Department and a civil probe by the SEC into matters involving alleged fraud and tax avoidance.
According to a Washington Post article about the UBS debacle published in February: “Executives “at the highest levels of management,” as well as lower-ranking managers and employees, are unindicted co-conspirators, according to yesterday’s filings.”
UBS problems with U.S. authorities are far from resolved and there remains a concern UBS bankers are at risk of being arrested when travelling outside of Switzerland. A Daily Telegraph article headlined “UBS halts foreign travel over tax worries” reported: “The Swiss bank, which is in a legal battle with the US over its unwillingness to divulge names of American clients it helped avoid paying tax, has issued a global travel ban…” It remains to be seen if the risk of arrest and potential extradition extends to UBS directors.
It would surely have been wiser to find a suitable candidate for the Shell CEO position untainted by financial incompetence and scandal.