Chevron CEO Watson Embroiled in Spy Scandal to Undermine $27 Billion Ecuador Trial

Kroll's Sam Anson Identified As Chevron Undercover Operative Running Illicit Program

Amazon Defense Coalition
17 August 2010 - FOR IMMEDIATE RELEASE
Contact: Karen Hinton at +1.703.798.3109

Quito, Ecuador – Chevron CEO John Watson is again on the hot seat after the company's growing spy scandal in Ecuador was highlighted on a nationally-syndicated news program only weeks after he ordered that five shareholders arrested at the company's annual meeting for challenging him over the company's Ecuador contamination.

Watson, who has long been accused of having a personal conflict of interest because he oversaw the purchase of Texaco without properly vetting the company for its $27 billion potential Ecuador liability, is being asked to explain how his company became embroiled in a corporate espionage scandal involving an American journalist, Mary Cuddehe.

Watson has remained silent on the issue since the spy story, written by Cuddehe, broke last week in The Atlantic.

In the article and in an interview conducted yesterday with Democracy Now! host Amy Goodman, Cuddehe said she was offered $20,000 to lie about her identity and gather information for the company under the false pretense of writing a story about the Ecuador environmental trial.

Directing investigators to lie about their identity is considered unethical and potentially illegal under U.S. and Ecuadorian law. In 2006, Hewlett-Packard (HP) Chairwoman Patricia Dunn was ousted over a similar undercover operation at HP and later faced criminal charges.

"It is apparent that Chevron, under Watson's stewardship, has authorized an illegal spy operation in Ecuador to undermine the rule of law and it has been ongoing for at least several months," said Karen Hinton. "Mr. Watson needs to explain how Chevron signed off on paying for this kind of outrageous misconduct and disclose which journalists in Ecuador are on Chevron's payroll."

It appears Chevron hired Kroll, the world's largest investigations firm, to enlist journalists to spy on the plaintiffs in Ecuador, according to Cuddehe, who first exposed the operation after a Kroll operative identified only as "Sam" tried to recruit her.

Cuddehe, an Iowa-born graduate of Columbia University with a degree in journalism, documented that Kroll has been running an espionage operation in Ecuador out of neighboring Colombia since at least February of this year.

Cuddehe wrote in The Atlantic: "Last February, I got an offer from Kroll ... to go undercover as a journalist-spy in the Ecuadorian Amazon. At first I thought I was under qualified for the job. But as it turned out I was exactly what they were looking for: a pawn."

It turns out that "Sam" is none other than San Anson, a former American freelance writer who currently heads Kroll's Latin American operations out of Miami. Anson has been outed in various blogs on the Internet. His LinkedIn profile, which matches biographical elements referenced in Cuddehe's story, was quickly removed after her article appeared.

Cuddehe indicated that numerous Kroll employees under Anson were working on the Ecuador project from a base in neighboring Colombia. With headquarters in New York, Kroll is considered the largest investigative firm in the world and is publicly traded.

"This is disturbing evidence of illicit conduct by Chevron and Kroll, possibly subjecting Chevron's lawyers to sanctions in the U.S.," said Jonathan Abady, an American lawyer who represents the plaintiffs. "It is hard to imagine Kroll engaging in this conduct alone without oversight and direction from Chevron executives and lawyers. Ultimately, the buck stops with Watson."

Events described in Cuddehe's article fit with a larger pattern in recent years of unethical and illegal activity by Chevron in Ecuador, where a trial that started in 2003 quickly produced evidence that pointed to the company's culpability. Lawyers for the plaintiffs have been subjected to death threats and other forms of intimidation, which in 2006 led the Organization of American States to order Ecuador's government to provide them police protection.

Last year, the Amazonian communities accused Chevron of violating the U.S. Foreign Corrupt Practices Act in Ecuador by engaging in a "sting" operation where a bribe was offered to help remove the trial judge from the case. An investigation determined that the "sting" operation and bribe offer was made by a long-time Chevron employee, Diego Borja, who remains on the company's payroll.

Watson was also under pressure over Ecuador in May of this year when, at his first annual meeting as CEO, Chevron security officials ordered the arrests of five proxy holders who had come to challenge him over the company's human rights record.

Chevron has admitted that Texaco deliberately dumped more than 18 billion gallons of toxic waste into the Amazon when it operated an oil concession from 1964 to 1990, leading to the decimation of indigenous groups and a dramatic spike in cancer rates. The plaintiffs allege Texaco committed environmental crimes in Ecuador for years and then tried to cover them up with a fraudulent clean-up in the mid-1990s.

Several Ecuadorian government officials and two Chevron lawyers who formerly worked for Texaco, Ricardo Reis Veiga and Rodrigo Perez Pallares, are currently under indictment in Ecuador for using a fraudulent laboratory test to induce a legal release from the government.

The U.S. law firms employed by Chevron to defend the Ecuador trial are Gibson Dunn, King & Spalding and Jones Day. One or more of the firms likely is overseeing Kroll's work, said Abady.