"The justice department should also be looking at the El Paso Corp. and Dynergy among
others."
TP, Ashcroft should but can he? Look at Bush's political contributions from the oil companies! And then
there is Cheney's SEC problem with Halliburton. Surely, no one is so naive that they would believe that
the Justice Dept. would take the accusations made against Halliburton seriously when Cheney was
Halliburton's CEO......
>>>>>>>>>>>>>>
Former Controller Sues Dynegy
Ex-Executive Says Firm's President Asked for Altered Books
washingtonpost.com
Associated Press
Sunday, August 4, 2002; Page
A14
HOUSTON, Aug. 3 --
Dynegy Inc.'s former
controller has sued the
energy company, claiming
that he was fired for
refusing a request to
change its accounting records.
Bradley Farnsworth, 49, who was responsible for
day-to-day accounting, claims he was asked by Stephen W.
Bergstrom, Dynegy's president and chief operating officer,
to alter the accounting of natural gas trading in Britain to
reduce the company's reported losses.
Farnsworth's lawsuit, filed Friday, does not allege that
Dynegy did what Farnsworth said he was asked to do.
Dynegy is reviewing the lawsuit and intends "to vigorously
contest Mr. Farnsworth's claims," Dynegy spokesman John
Sousa said.
In March 2000, the suit says, Farnsworth told Bergstrom
that he was concerned that Dynegy's British trading
operation had significant "short" positions in both gas and
power. Such positions would benefit Dynegy if commodity
prices declined.
The suit says he "discussed with Bergstrom the inherent
risks involved should prices in both the natural gas and
power markets rise simultaneously."
About a month later, prices for both rose, "resulting in
significant financial losses to the company, which violated
the company's established risk limits," according to the
suit. Throughout the summer, losses continued to
increase.
In August, the suit says, "Bergstrom specifically asked that
the plaintiff 'shave' or reduce for accounting purposes" the
model used to project gas prices for Oct. 1, 2000, to March
31, 2001.
Doing so would show less-severe company losses, the suit
says. The amount involved would have been "significant,"
lawyer Philip Hilder was quoted as saying by the Houston
Chronicle.
After refusing to take part in the alleged illegal practices,
Farnsworth was kept out of routine meetings on earnings
and eventually fired, the lawsuit says.
He was fired because "he wouldn't play ball," Hilder said.
The Securities and Exchange Commission and the U.S.
attorney's office in Houston are investigating Dynegy's
accounting for "Project Alpha," a complex accounting
vehicle that increases reported cash flow and cut taxes
with no other obvious purpose.
Asked if his client had talked to the SEC or prosecutors,
Hilder would not comment.
© 2002 The Washington Post Company
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