TGS Raided by Police, Charged With Tax Fraud in Industry SwoopMikael Holter
Police raided the offices of TGS Nopec Geophysical ASA and charged Norway’s biggest seismic surveyor of offshore oil and gas deposits with criminal violation of tax and trading laws as part of an industrywide swoop by prosecutors. The company fell the most in two weeks in Oslo trading.
Investigators stormed local oil-industry companies, arresting executives and issuing charges of tax fraud, accessory to tax fraud and market manipulation, said Marianne Steensen Bender, a senior public prosecutor. She declined to name companies other than TGS, which said it was raided and charged in a statement.
The economic crime unit “considers it a serious matter when it has charged several people and companies for cheating the government for several hundred million kroner,” Bender said today by mobile phone. “We’re in the very early stages of the case.”
The Norwegian National Authority for Investigation and Prosecution of Economic and Environmental Crime, known as Oekokrim, charged TGS in connection with a contract with oil company Skeie Energy AS, later known as E&P Holding AS, in 2009, according to the Asker-based seismic surveyor’s statement.
Skeie bought seismic data and settled the contract through a $42 million loan, and a cash payment of lower value than the loan, TGS Chief Financial Officer Kristian Johansen said in a phone interview today. “We need to handle this professionally and cooperate with Oekokrim and present the documentation we may have and everything they ask for,” he said.
No one at E&P Holding was immediately available to comment when contacted by Bloomberg News by phone today.
Income from Norway’s oil and gas industry, western Europe’s biggest, will make up 27 percent of the state’s total income in 2014, the government’s budget says. It accounts for more than 20 percent of the Norwegian gross domestic product. While Norway has a top tax rate for oil companies of 78 percent, explorers and producers are allowed tax deductions for expenses.
TGS fell as much as 4 percent, the biggest drop since April 23, and was down 2.3 percent at 204.9 kroner by 12:12 p.m. in Oslo.