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

To: TigerPaw who wrote (4395)	8/22/2002 12:23:34 AM
From: Mephisto	Respond to of 5185

"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 washingtonpost.com