FBI investigates army secretary's Enron dealings
David Teather in New York
Tuesday April 16, 2002
The Guardian
The US government was dragged back into the Enron scandal
yesterday with reports that federal investigators are studying
possible insider trading by army secretary Thomas White.
Federal Bureau of Investigation agents are said to be focusing
on calls and contacts Mr White had with Enron executives in
October, two months before the company collapsed. Mr White,
a former vice chairman of the failed US energy firm, sold half of
his shares during the month, netting more than $3m (£2m).
According to the reports, the FBI has interviewed friends and
former colleagues of Mr White to find out whether he sought any
information on Enron's financial position as it stumbled toward
bankruptcy.
Mr White has told congressional investigators of 73 contacts
with current or former Enron employees since he joined the
Bush administration 10 months ago. The majority were between
the August resignation of chief executive Jeffery Skilling and the
December 3 bankruptcy filing.
Mr White has maintained that the calls were motivated by
concern over the fate of former colleagues and that he did not
act on any inside information. He has also denied knowledge of
the off-shore partnerships that masked Enron's debt and
eventually triggered its demise.
Colonel Jim Allen, a spokesman for Mr White, told the Wall
Street Journal: "He [Mr White] was given a deadline to sell, he
asked for and got an extension, then the war in Afghanistan
came along and he was busy. By the end of October he'd totally
divested himself of stock. The secretary has answered all these
questions repeatedly." A spokesman for the FBI in Washington
declined to comment.
The Bush administration's relationship with Enron has come
under intense scrutiny since the energy firm became the biggest
bankruptcy in corporate history. Kenneth Lay, another former
chief executive, was a personal associate of the president and
Enron was one of the biggest backers of the Bush election
campaign.
Talks aimed at ensuring the survival of Arthur Andersen, the
accountancy firm that audited Enron's accounts, were
continuing last night. The US offices of Andersen are attempting
to settle an indictment for obstruction of justice ahead of a trial
due at the beginning of next month.
guardian.co.uk |
