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Non-Tech : The ENRON Scandal -- Ignore unavailable to you. Want to Upgrade?

To: Baldur Fjvlnisson who wrote (1979)	1/31/2002 11:33:53 AM
From: Baldur Fjvlnisson	Read Replies (1) \| Respond to of 5185

Andersen papers lost in Sunbeam case By Greg Farrell, USA TODAY HOUSTON — Arthur Andersen's admission that it destroyed Enron documents during a government investigation wasn't a first for the auditor. Four years ago, as the Securities and Exchange Commission was investigating Sunbeam's restatement of earnings, sensitive documents relating to that audit were destroyed in Andersen's Fort Lauderdale office, court records show. Read more below -------------------------------------------------------------------------------- Latest stories Andersen papers lost in Sunbeam case Study: Campaign finance bill wouldn't have helped New Enron leader says he'll try to save jobs Full coverage index: Enron collapse -------------------------------------------------------------------------------- Graphic Timeline of key events -------------------------------------------------------------------------------- Audio Is your 401k safe? Bush: Enron flap won't distract him -------------------------------------------------------------------------------- Talk The Enron collapse: Mark Cheffers -------------------------------------------------------------------------------- From our archives Peeling back the layers of Enron's breakdown Enron made a sound investment in Washington Trouble grew in Enron's interlinking partnerships The Enron scandal by the numbers Congress could've seen it coming Contacts between Enron, Bush Cabinet detailed -------------------------------------------------------------------------------- On Nov. 16, 1998, months after Andersen restated Sunbeam's earnings for 1996 and 1997, and after Sunbeam had been hit with a barrage of shareholder lawsuits, an Andersen partner said the firm ordered its Fort Lauderdale employees to dispose of any work papers or correspondence "that don't agree with the final documentation" of the Sunbeam restatement. That revelation was made by Phillip Harlow, Andersen's lead partner on Sunbeam, in a deposition for a shareholder lawsuit that grew out of the Sunbeam restatement. In it, Harlow said Spanish-speaking cleaning people threw away Sunbeam-related work papers stored in a trash bin bearing a "do not destroy" label in English at his firm's offices. Harlow also said his original handwritten notes on the restatement had been thrown away. Harlow gave his deposition in a lawsuit filed by the U.S. National Bank of Galveston in Texas. At the request of Andersen's attorneys, Harlow's deposition has been sealed from the public. But in several court filings, plaintiff's attorney Joseph Jamail quoted from Harlow's deposition on his client's behalf; those are part of the public record. Jamail, most famous for winning a $10.5 billion judgment for Pennzoil over Texaco in 1987, would not comment on Harlow's sealed deposition, other than to say, "One man's trash is another man's treasure." The revelations take on added significance, given what happened in Andersen's Houston office in October, after the SEC began its preliminary investigation of Enron's financial statements. Early this month, Andersen executives admitted to congressional investigators that the auditor's lead engagement partner on Enron, David Duncan, organized an officewide campaign to destroy Enron-related documents and files from Oct. 23 to Nov. 9. Andersen CEO Joseph Berardino fired Duncan and suspended several other Houston employees on Jan. 15, saying, "It should be perfectly clear that Andersen will not tolerate unethical behavior, gross errors in judgment or willful violation of our policies." SEC litigation against Andersen is pending in the Sunbeam case; the firm settled the Galveston case for an undisclosed sum. Harlow still works at Andersen's Fort Lauderdale office. Harlow couldn't be reached Wednesday. According to Andersen spokesman Patrick Dorton, the only documents lost involved Sunbeam's restatement of earnings, not the original audit. "Anderson's restatement work has never been questioned in any proceeding."