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Non-Tech : The ENRON Scandal

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To: Mephisto who wrote (3930)	4/24/2002 1:42:27 AM
From: Mephisto	Read Replies (1) of 5185

Bankruptcy Reform Inspired by Enron Amendment Would Cap Home Shield By Kathleen Day Washington Post Staff Writer Tuesday, April 23, 2002; Page A05 Congressional staff trying to reconcile the House and Senate versions of bankruptcy legislation have added an Enron-inspired amendment to the list of items to haggle over: a proposal to severely cut the amount of home equity that an individual who has violated federal securities law could shield from creditors during bankruptcy. The proposal would cap at "several hundred thousand dollars" the home equity that could be kept by an individual filing for bankruptcy in Texas or the four other states that currently set no limit on the amount of home equity that can be shielded, according to congressional sources. Sources said the amendment, proposed by Sen. Herb Kohl (D-Wis.), is gaining backing from both Republicans and Democrats, inspired by reports of former Enron Corp. chairman Kenneth L. Lay's $7 million penthouse apartment in Houston -- even though Lay has not been charged with any wrongdoing and has not filed for bankruptcy. In what would be the most substantial overhaul of federal bankruptcy law in more than two decades, the House and Senate last year each passed versions of legislation that, in general, would make it harder for individuals to wipe out debt by declaring bankruptcy. But the two chambers have been unable to reconcile key differences of opinion. One is over how much equity bankruptcy filers should be allowed to keep in their homes. The Enron-inspired provision is a small part of this issue. The other is language in the Senate version that is aimed at preventing anyone convicted of blocking an entrance to an abortion clinic from filing for bankruptcy to avoid paying court-imposed fines. Abortion foes have opposed that provision. A group of lawmakers from the House and Senate are scheduled to meet this afternoon for a public conference to try to craft a compromise that both chambers could then vote on. But congressional sources cautioned that although the legislation looks much more viable than it did late last year, the sticking points are the same ones that have helped kill similar proposals in the past. © 2002 The Washington Post Company

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