Senate probes Clinton loans for Enron deals
POWER FOR SALE
Senate probes Clinton
loans for Enron deals
Finance committee finds 3 federal agencies gave 'hundreds of millions' to risky projects
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Posted: February 20, 2002
11:41 p.m. Eastern
By Paul Sperry
© 2002 WorldNetDaily.com
WASHINGTON -- Under the Clinton administration, the Overseas Private Investment Corp. "gave hundreds of millions of dollars" in loans and other government support to risky Enron-related projects overseas, according to a Senate Finance Committee audit released today.
As WorldNetDaily first reported Jan. 22, Enron became one of OPIC's biggest customers during the Clinton years.
From fiscal year 1993 to fiscal 2000, OPIC gave at least $544 million in loans to Enron-related projects, the agency reported in a letter to the Senate panel. It provided another $204 million in political-risk insurance. OPIC listed only currently supported projects.
The Export-Import Bank, another federal overseas economic-development agency, gave more than $650 million in loans to Enron-related projects over the same period, confirming WorldNetDaily's earlier reporting.
Between 1993 and 1995 alone, Ex-Im Bank supported Enron deals in India, Turkey, the Philippines and China worth nearly $4 billion, making the Houston-based company one of the biggest beneficiaries of the Clinton administration’s export policy. The head of the federal bank at the time, Kenneth Brody, is a close friend of former Treasury Secretary Robert Rubin, having worked with Rubin at Goldman Sachs. In his financial disclosure report, Rubin listed Enron among firms with which he had significant contact at his Wall Street firm. Former Enron CEO Ken Lay offered Rubin a seat on Enron’s board in 1999, as he was resigning from the Clinton administration.
The Senate panel asked for data back to 1985. "It appears the agency made no loans to Enron-related businesses from 1985 to 1992," during previous Republican administrations, said Sen. Chuck Grassley, R-Iowa, ranking committee member.
Current outstanding balance on all the Clinton-era federal loans to Enron-related projects is $965 million, according to documents. With the insurance liability, the federal agencies' indirect exposure to Enron-related projects approved by the Clinton administration totals nearly $1.2 billion.
"These loans obviously were a tremendous benefit to Enron's operation," Grassley said, particularly since commercial banks rarely finance such long-term projects in unstable foreign markets.
A committee investigator told WorldNetDaily that the panel is reviewing confidential memos written or received by OPIC and Ex-Im Bank officials regarding the Enron transactions.
Former OPIC head Ruth Harkin was appointed by Clinton after her husband, Sen. Tom Harkin, D-Iowa, campaigned vigorously for Clinton in '92 and '96. The senator was one of the ex-president's biggest boosters during his impeachment trial.
Prior to joining the Clinton administration, Ruth Harkin was a top corporate lawyer at Akin Gump Strauss Hauer & Feld, a Washington firm that includes Clinton pal Vernon Jordan and Democratic power broker Robert Strauss. Akin Gump has listed Enron among its clients.
Ex-Im Bank board members during the Clinton years include Jackie Clegg, wife of Sen. Chris Dodd, D-Conn., and Maria Haley, a former aide to Clinton in Little Rock and ex-wife of John Haley, who was convicted in the Whitewater investigation.
Dodd served as co-chairman of the Democratic National Committee during the '96 Clinton-Gore campaign. Clinton appointed Clegg vice chair of the Ex-Im Bank board in June 1997.
Haley has ties to the crooked Riady family who operate the Lippo Group out of Jakarta, Indonesia. The Riadys ran afoul of federal bank regulators after they took control of the Worthen Bank in Little Rock in the 1980s. Haley's long-time law partner, Mark Grobmyer, a Clinton golfing buddy, is a Lippo lobbyist.
While at Ex-Im Bank, documents show Haley OK'd federal loans for Indonesian projects worth more than $40 billion, including many involving Lippo and its subsidiaries.
Clinton replaced her on the board with Vanessa Weaver, who was forced by the Senate Banking Committee to recuse herself from Lippo transactions after a 1999 Investor's Business Daily story exposed her close ties to Lippo executive John Huang.
Both Huang and James Riady have since been convicted of fraud relating to Clinton-Gore fund-raising.
Two Enron executives -- Joseph Sutton and Rebecca McDonald -- have served on the Ex-Im Bank's advisory committee.
Enron, which usually backs Republicans, gave more than $150,000 to Clinton's party during the 1996 election cycle.
Yet another federal agency, the Trade and Development Agency kicked in more than $1.1 million from 1992 to 2001 for foreign projects involving Enron or its subsidiaries. It also sponsored 11 visits to the U.S. by foreign officials who participated in Enron-related projects.
Previous stories:
Huge Clinton loans to Enron may expose taxpayers
Clinton 'sweetheart' deal sped Enron's collapse
Enron execs regulars on Clinton trade trips
Did Enron insiders smell trouble in '98?
Related column:
Enron: The Clinton connection
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