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Daily Telegraph: Watchdog clears Watts over Shell reserves error: Thursday 10 November 2005

By Robert Miller (Filed: 10/11/2005)

Sir Philip Watts, the former chairman of Shell, was yesterday cleared of any wrongdoing by the City's watchdog for miscalculating the amount of oil it had left in its reserves.

The Financial Services Authority (FSA), which last year fined the oil giant 17m for committing market abuse and breaching stock market listing rules, said it would take no further action against the individuals it had been investigating.

Sir Philip Watts
Sir Philip Watts has maintained throughout that he acted properly

Sir Philip, who resigned in March 2004, and Walter van de Vijver, the former head of Shell's Exploration & Production arm, were both investigated by the FSA over their role in the reserves miscalculation.

Sir Philip's lawyers, Herbert Smith, said last night: "Sir Philip Watts is very pleased that, after a long period of investigation, including detailed consideration of his representations by the Regulatory Decisions Committee, the FSA has decided that no action should be taken against him.

"This vindicates the position Sir Philip has maintained throughout: that he acted properly and in good faith at all times."

In the US, where Shell was fined $120m (70m) last year and is under investigation by the Securities & Exchange Commission, John Dowd of Akin Gump, Mr van de Vijver's attorney, said: "He has steadfastly maintained from the beginning that the allegations were without merit. Now the FSA has vindicated his position."

The FSA last night defended its 18-month investigation into the two former Shell directors. A spokesman commented: "It's absolutely right that we will always investigate cases where we think there may have been wrongdoing."

14 September 2005: Former Shell chief loses appeal over reserves
26 July 2005: FSA says that reserves report targeted corporate personality, not individuals
23 July 2005: Former Shell chairman to challenge FSA findings

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