Senate Committee hearing scheduled Jan 24. Will Lay ever appear?
guardian.co.uk
Senate demands Enron documents
Committee to examine energy firm's links with
White House
David Teather in New York
Guardian
Thursday January 3, 2002
Connections between the White House and the ill-fated
energy business Enron could come under scrutiny from yet
another investigation started into the spectacular collapse
of the company.
A division of the senate governmental affairs committee
yesterday said it intends to demand documents next week
and scheduled a hearing on the affair for January 24.
Senator Joseph Lieberman, the Connecticut Democrat who
chairs the committee, said the investigation would focus on
federal and corporate watchdogs' failure to prevent the
swift downfall of the firm.
"Enron's unexpected collapse raises some troubling
questions that the governmental affairs committee will be
asking," Mr Lieberman said.
He maintained that the hearings would not degenerate into
a witch-hunt to establish ties between the Bush
administration and Enron. Kenneth Lay, the Enron chief
executive, was a significant contributor to President Bush's
election campaign, and is a family friend.
But Mr Lieberman said he could not rule out the committee
examining Enron's links to the government. "It's a matter of
public record that executives of Enron had close
relationships with people who are now in the Bush
administration," Mr Lieberman said.
Mr Lay, he said, "played an active role in the formulation of
energy policy by the Bush administration. We've got to ask
whether the advice rendered was at all self-serving."
Enron, which had been among the top flight of Wall Street
firms, made the largest bankruptcy filing in US his tory
following the failure of a rescue takeover by rival Dynergy.
The events stunned both investors and workers at the
Houston, Texas-based company alike.
The inquiry will examine whether the collapse of Enron was
a regulatory failure or whether management of the
company was wholly at fault.
Mr Lieberman said he hoped to establish why senior
executives were able to sell shares ahead of the collapse
while workers were prevented from doing so. Thousands of
Enron employees lost their jobs as well as much of their
savings.
The Enron pension plan made many heavily dependent on
Enron shares to provide for their retirement. "Why did the
company prevent its own employees liquidating company
stock to salvage what was left of their family nest eggs?"
Mr Lieberman asked. Documents from Enron's board of
directors, other top executives and auditors will be
demanded.
The investigation will also explore how Enron used offshore
entities and its complex web of business partnerships.
Enron and its executives are already under examination by
the market-regulating securities & exchange commission,
the departments of justice and labour and four other
congressional committees. Mr Lay has so far declined
invitations to testify at two hearings held in December and
it remains unclear whether he will be asked to give
evidence in the latest hearing.
The dramatic end of Enron has thrown the spotlight on the
accounting profession - Andersen audited Enron - and
analysts on Wall Street for their provision of reliable
information to investors. |
