Occidental Petroleum Corp. was accused Wednesday of engaging in a "fraudulent scheme" to "falsify" financial records to artificially lower costs to construct the Armand Hammer Museum of Art and Cultural Center in Westwood.
The accusation, filed on behalf of dissident Occidental shareholder Alan R. Kahn, was contained in court papers made public in Wilmington, Del. The filing came after The Times reported that Occidental used bookkeeping devices to switch millions of dollars of costs originally charged to the museum construction to other accounts.
New York attorney Sidney Silverman, representing Kahn, charged in an affidavit in Delaware Chancery Court that Occidental ordered the bookkeeping changes to falsely create the impression that it had reduced construction costs to $60 million or less.
A proposed settlement of another shareholder lawsuit seeking to block construction of the museum includes a provision--accepted by Occidental--limiting museum construction costs to not more than $60 million. If the true construction cost exceeds that amount, the settlement agreement could be nullified. The judge previously set an April 4 hearing on the proposal.