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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsPotential Secretary of State Nominee Rex Tillerson Has an SEC Problem
https://www.thenation.com/article/potential-secretary-of-state-nominee-rex-tillerson-has-an-sec-problem/Most of the commentary over Donald Trumps presumed secretary-of-state nominee Rex Tillerson concerns the Exxon Mobil CEOs closeness to Russia, and Senate Republican discomfort with that relationship. But Trump and Tillerson share something else that hasnt gotten as much attentiona penchant to rip off their business partners.
In ExxonMobils case, Im talking about shareholders. Tillersons company has been under formal investigation by the Securities and Exchange Commission since August for failing to accurately value its proven oil reserves.Those reserves are critical to investors for assessing the future viability of the company. Without the certainty that the company can keep crude oil flowing decades into the future, ExxonMobil stock would plummet. Rewriting the disclosures to investors with lower valuations would cost the company billions of dollars. And actually the entire oil and gas industry would be affected by a new standard rather than the current ad hoc system.
(snip)
The SEC also wants to know why ExxonMobil does not write down the value of its reserves when oil prices drop. The crash began two years ago; a barrel of oil fetched $115 in June 2014, but under $28 by February. Even with the recent announcement of OPEC production cuts, the price has barely crested $50. But ExxonMobil never factored that loss into its calculations of future reserves; by contrast, Chevron has written down $50 billion. Exxon said in October it could de-book about 20 percent of its reserves if prices remain low, but it hasnt done it yet.
Exxon claims that it doesnt overstate its reserves (which at the end of 2015 totaled 24.8 billion oil-equivalent barrels) and book those values conservatively. Our financial reporting meets all legal and accounting requirements, said spokesman Alan Jeffers in September. But if the company was found to be touting phantom future profits, it would surely be committing securities fraud against investors.
(end snip)
Overstating his reserves? Say it ain't so. No wonder he needs Pooty Poot to drill in the Artic.
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Potential Secretary of State Nominee Rex Tillerson Has an SEC Problem (Original Post)
deminks
Dec 2016
OP
Yup, looks like the Fuhrer-Elect is putting another fox in charge of the henhouse... geez!!!
InAbLuEsTaTe
Dec 2016
#2
TeamPooka
(24,218 posts)1. As always, Follow the money. nt
InAbLuEsTaTe
(24,122 posts)2. Yup, looks like the Fuhrer-Elect is putting another fox in charge of the henhouse... geez!!!
Someone please wake me up from this nightmare!!
deminks
(11,014 posts)3. kick for the morning