Just how clean is Mr. Clean ? The rot seems to have really spread around - put up the cash, buy yourself a few more favors. Even Volker's been in on it.
news.ft.com
Enron considered influencing accounting body
By Peter Spiegel in Washington and Michael Peel in London
Published: February 13 2002 20:45 | Last Updated: February 14 2002 03:41
Leading accounting rule makers asked Enron for a $500,000
donation, a request that executives at the bankrupt energy giant
considered because it might help them influence global
accounting standards.
According to congressional investigators, Enron executives last
year thought about donating half a million dollars to the
London-based International Accounting Standards Board - but
only if they could gain access to officials at the self-regulatory
body and influence its policies.
The IASB is a private sector body set up last year to lead the drive for global accounting
rules. The European Commission plans to make companies listed in European Union markets
comply with IASB rules.
According to an e-mail written in February 2001, Paul Volcker, former Federal Reserve
chairman and chairman of the IASB's trustees, phoned Kenneth Lay, then Enron's chief
executive, soliciting the donation.
It would have been paid in $100,000 instalments over five years, but it is unclear if the sum
was paid and if executives managed to gain any influence.
On Wednesday, Kevin Stevenson, IASB director of technical activities, said he was unaware
of any donation by Enron. He said the board had approached a number of companies and
accountancies as part of its fundraising drive.
Carl Levin, chairman of the Senate's permanent subcommittee on investigations, which
uncovered the missive, said the e-mail showed Enron was seeking to buy access to IASB
officials, a problem he said had plagued a similar rule-making body in the US, the Financial
Accounting Standards Board. "Enron wanted to know whether its money would buy access
and influence at the new accounting standards board, and its auditor didn't bat an eye at this
inquiry."
Mr Levin said he did not think Mr Volcker's approach was improper, but added: "Contributions
to the account standards boards affect the boards' independence, and that's bad news for
reliable accounting."
According to the e-mail, Richard Causey, Enron's chief accounting officer, asked the
company's auditors at Andersen whether the donation would allow them to influence
policymaking at the IASB.
"Rick is inclined to do this given Enron's desire to increase their exposure and influence in
rule-making," wrote David Duncan, the Andersen accountant in charge of Enron's audit. "He
is interested in knowing whether these type of commitments will add any formal or informal
access to this (ie would these type commitments present opportunities to meet with the
trustees of these groups or other benefits)."
Earlier this month, Mr Volcker agreed to head a committee looking into Andersen's internal
practices. |
