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Enron Mail |
NYSE Moves To Delist Enron Stock Dow Jones News Service, 01/15/2002 NYSE says delisting Enron shares - UPDATE AFX News, 01/15/2002 Writer Of Enron Warning Letter Worked With Ex-CFO Fastow Dow Jones Energy Service, 01/15/2002 Enron DIP Financing Now Likely Halved To About $700M Dow Jones News Service, 01/15/2002 Enron Executives, Andersen Sued By Shareholder Dow Jones Energy Service, 01/15/2002 UBS won't pay anything in deal for Enron trading operation Associated Press Newswires, 01/15/2002 Enron loans sting bank's bottom line Associated Press Newswires, 01/15/2002 ODJ Market Special: Bond Futures Rally On Enron Delisting Dow Jones Commodities Service, 01/15/2002 CAPITAL VIEWS: Early Washington Noise On Budget, Enron Dow Jones Capital Markets Report, 01/15/2002 Lieberman Asked to Recuse Himself From Enron Probe PR Newswire, 01/15/2002 Sen. Lieberman Asked to Recuse Himself From Enron Probe Dow Jones Energy Service, 01/15/2002 USA: Treasury's O'Neill sees positive US economic signs. Reuters English News Service, 01/15/2002 Nevada Sen. Ensign on panel probing Enron Associated Press Newswires, 01/15/2002 Enron, which lobbied for corporate tax repeal, faces Congress probe over it= s own tax returns Associated Press Newswires, 01/15/2002 Fired Andersen Executive Says He Followed Company Orders Dow Jones News Service, 01/15/2002 USA: UPDATE 1-Fired Andersen partner to meet investigators Wed. Reuters English News Service, 01/15/2002 ROUNDUP Andersen fires Enron auditor who knowingly destroyed documents AFX News, 01/15/2002 Arthur Andersen fires chief Enron auditor; 3 other partners sent on leave AFX News, 01/15/2002 USA: Business group wary of new regs from Enron case. Reuters English News Service, 01/15/2002 USA: US official sees Enron slowing energy mart change. Reuters English News Service, 01/15/2002 Power Trading Business Could Be Good Fit For UBS Warburg Dow Jones Energy Service, 01/15/2002 USA: UPDATE 1-US lawmaker seeks Enron pension, accounting probes. Reuters English News Service, 01/15/2002 Enron debacle costs state millions of dollars Associated Press Newswires, 01/15/2002 Forbes.com Exclusive; Enron: the Wrong Focus Business Wire, 01/15/2002 Farewell to all that U.S. News & World Report, 01/21/2002 The Nation Enron Chief Was Warned of Problems Energy: A top officer's memo = to Chairman Lay, found by congressional investigators, cautioned that 'funn= y accounting' practices could embroil the firm in scandal. Los Angeles Times , 01/15/2002 Enron Analysis CNNfn: The Money Gang, 01/15/2002 Andersen`s Role in the Enron Collapse CNNfn: The Money Gang, 01/15/2002 Commentary Bush to Lay: What Was Your Name Again? Los Angeles Times , 01/15/2002 Commentary When Going Gets Tough, the Tough Shred Los Angeles Times, 01/15/2002 Search for the Truth Regarding Enron Los Angeles Times, 01/15/2002 Enron Could End Up Where It Started Energy: The auctions of assets would re= move core businesses, leaving a pipeline operator. Los Angeles Times , 01/15/2002 Ex-Enron Execs Launch Firm to Market Energy Los Angeles Times, 01/15/2002 Compaq, HP Detail Retention Bonuses Merger: Packages are designed to keep i= mportant employees during integration of the technology companies. Los Angeles Times, 01/15/2002 Back to Business U.S. News & World Report, 01/21/2002 Leavitt accepted $10,000 from Enron Associated Press Newswires, 01/15/2002 Employee Warned Enron CEO of Implosion CNN: Special Report With Aaron Brown, 01/15/2002 __________________________________________________________________ NYSE Moves To Delist Enron Stock By Gaston F. Ceron 01/15/2002 Dow Jones News Service (Copyright © 2002, Dow Jones & Company, Inc.) Of DOW JONES NEWSWIRES=20 NEW YORK -(Dow Jones)- The New York Stock Exchange said it is suspending tr= ading in Enron Corp. (ENE) and moved to delist the embattled energy company= 's shares from the Big Board. The NYSE said in a statement that it "has determined that the company's sec= urities are no longer suitable for trading on the NYSE." The exchange's act= ion affects not only Enron stock, but also other Enron securities, such as = preferred convertible stock.=20 Enron officials weren't immediately available for comment.=20 Enron's collapse last year triggered a huge drop in the company's stock, se= nding it down to mere pennies a share, as well as layoffs at the Houston co= mpany. It also set off the biggest U.S. corporate bankruptcy ever.=20 The NYSE moved to delist Enron after the company's stock traded below the c= ritical level of $1 for 30 consecutive days, placing it in violation of the= Big Board's listing standards.=20 "The exchange notes that today's action is being taken due to the expected = protracted nature of the company's bankruptcy process and the uncertainty a= t this time as to the timing and outcome of this process as well as the ult= imate effect on the company's common shareholders," the NYSE said in a writ= ten statement.=20 The exchange said it will apply to the Securities and Exchange Commission t= o delist Enron securities "upon the completion of applicable procedures, in= cluding any appeal by the company of the NYSE staff's decision."=20 The last time Enron shares traded at the NYSE was Thursday. Trading in the = shares has been halted since.=20 -Gaston F. Ceron, Dow Jones Newswires; 201-938-5234; gaston.ceron@dowjones.= com=20 Christina Cheddar contributed to this article.=20 Reached later, Enron spokeswoman Karen Denne said the NYSE's decision wasn'= t a surprise to the company.=20 "This will have no effect on our business," Denne said. "We are still evalu= ating the NYSE's decision and have not yet made a final determination of an= y action we may take."=20 -Gaston F. Ceron and Christina Cheddar, Dow Jones Newswires; 201-938-5166; = christina.cheddar@dowjones.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 NYSE says delisting Enron shares - UPDATE 01/15/2002 AFX News © 2002 by AFP-Extel News Ltd (Updating to add further details)=20 NEW YORK (AFX) - The New York Stock Exchange said it is delisting Enron Cor= p shares with immediate effect after they traded below the exchange's one u= sd threshold for more than a month. The shares, which have been suspended from trading for the past several day= s pending the announcement of details of the company's sale of its wholesal= e energy trading unit to UBS Warburg, last traded at 67 cents.=20 In a statement, the NYSE said Enron has the right to a review of the decisi= on by a committee of the board of directors of the exchange.=20 "The Exchange notes that today's action is being taken due to the expected = protracted nature of the company's bankruptcy process and the uncertainty a= t this time as to the timing and outcome of this process as well as the ult= imate effect on the company's common shareholders," said the statement.=20 cl/gc Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Writer Of Enron Warning Letter Worked With Ex-CFO Fastow By Jason Leopold 01/15/2002 Dow Jones Energy Service (Copyright © 2002, Dow Jones & Company, Inc.) Of DOW JONES NEWSWIRES=20 LOS ANGELES -(Dow Jones)- The letter to Enron Corp. (ENE) Chairman and Chie= f Executive Ken Lay last August, warning that irregularities relating to En= ron's off-balance sheet partnerships could bring about the company's demise= , was written by Sherron Watkins, the company's vice president of communica= tions in charge of corporate investigations, employee relations and policy,= Enron confirmed late Monday. The existence of the letter was disclosed Monday afternoon by the House Com= merce and Energy Committee, which is investigating the one-time market lead= er's collapse.=20 Watkins had worked for former Chief Financial Officer Andrew Fastow, whose = involvement with some of the off-balance sheet partnerships raised question= s of conflicts of interest. Enron removed Fastow from his position in Octob= er after reporting losses related to transactions involving the Fastow part= nerships.=20 The letter released by the House committee raised questions about the secre= cy and accounting of the off-balance sheet partnerships.=20 "I am incredibly nervous that we will implode in a wave of accounting scand= als," the letter said.=20 Watkins said in the letter that other Enron officials "consistently and con= stantly" had questioned the accounting methods to senior Enron officials, a= nd directly to Jeff Skilling, Enron's former president and chief executive.= =20 "Mr. Skilling flatly denies the allegations in the letter related to him," = said Judy Leon, a spokeswoman for Skilling.=20 On Oct. 16, Enron announced hundreds of millions of dollars in third-quarte= r losses and a writedown of more than a billion dollars in shareholder equi= ty relating to the partnerships. The company filed for bankruptcy Dec. 2.= =20 Watkins' letter is the earliest known communication to Enron's CEO that the= handling of the partnerships could prove disastrous for the company.=20 Letter Writer In Position To 'Learn Things'=20 Robert S. Bennett, Enron's attorney, confirmed that Watkins wrote the lette= r, but didn't immediately know the date. Skilling resigned from the company= Aug. 14, citing personal reasons. Skilling said in an interview last month= that he had no idea the partnerships posed any threat to Enron.=20 Bennett said Watkins had worked closely with Fastow and was in a position t= o "learn things" about Enron. Bennett couldn't describe the extent of Watki= ns' work for Enron, nor could a company spokeswoman.=20 "She wrote the letter, which was initially an anonymous letter, and when it= came to Mr. Lay's attention he became concerned," Bennett said in an inter= view with Dow Jones Newswires. Lay "went to the general counsel to investig= ate and get to the bottom of it."=20 Bennett said Watkins met Lay for an hour last August to discuss the concern= s she brought up in the letter, and he said she left the meeting "quite imp= ressed" when Lay said he would investigate the issue.=20 Lay directed Vinson & Elkins, a law firm with offices in Houston, to look i= nto the concerns raised by Watkins, but not to "second-guess" the accountin= g advice from Andersen, the committee noted.=20 Vinson & Elkins concluded that "further widespread investigation by indepen= dent counsel and auditors" was unwarranted. But the firm warned that "bad c= osmetics" involving the transactions and the decline of Enron's stock posed= the "serious risk of adverse publicity and litigation."=20 The House Committee on Energy and Commerce acted unfairly by releasing the = letter, Bennett said.=20 "It's very unfair to suggest the company was trying to whitewash anything,"= Bennett said. Lay "wanted an answer quickly and not spend a year with a la= w firm doing an inquiry. I think this shows that what Mr. Lay did is very r= esponsible. If the law firm said an investigation was needed, then Mr. Lay = would have agreed."=20 Enron, however, made only scant reference to the partnerships on Oct. 16, w= hen the company released its third quarter earnings, which included losses = related to transactions with the partnerships.=20 It was those losses combined with other disclosures that led to a loss of i= nvestor confidence and eventually led to Enron filing for bankruptcy in Dec= ember.=20 Letter Writer Asked To Be Reassigned=20 Reached late Monday evening, Philip Hilder, Watkins' Houston attorney, said= Watkins worked for Fastow for a couple of months last summer and asked to = be reassigned in late August because she was concerned about accounting irr= egularities she witnessed related to the Fastow partnerships. Hilder wouldn= 't elaborate.=20 "She worked for Mr. Fastow for a short period of time last summer. Maybe a = couple of months," said Hilder, who worked for the Department of Justice an= d was a former federal prosecutor. "She asked to be reassigned."=20 Gordon Andrew, Fastow's spokesman, said Fastow "would not comment at this t= ime on any aspect of the investigation."=20 Watkins, who had previously worked in the company's broadband division as v= ice president, has been subpoenaed by the Securities and Exchange Commissio= n but hasn't testified yet, Hilder said. Neither the Justice Department nor= the various congressional committees investigating Enron's collapse has su= bpoenaed Watkins, he said.=20 "It's unclear when Watkins will testify before the SEC," Hilder said.=20 Hilder said Watkins wasn't a stakeholder in any of the partnerships set up = by Fastow nor did she benefit financially from them, but Watkins was "invol= ved" in some capacity in the various entities, the extent of which Hilder w= ouldn't disclose. Hilder said the letter Watkins wrote to Lay didn't includ= e a date and was, at first, anonymous. He wouldn't say what the events were= that led up to her meeting with Lay last August, why she wrote the letter = or how her identity as the author became known.=20 While Enron's most recent roster lists Watkins as vice president of communi= cations, Hilder said Watkins title was previously vice president of corpora= te development and that her title may have changed with the company's bankr= uptcy and restructuring.=20 -By Jason Leopold, Dow Jones Newswires; 323-658-3874; jason.leopold@dowjone= s.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Enron DIP Financing Now Likely Halved To About $700M By Carol S. Remond 01/15/2002 Dow Jones News Service (Copyright © 2002, Dow Jones & Company, Inc.) Of DOW JONES NEWSWIRES=20 NEW YORK -(Dow Jones)- Despite receiving no cash upfront from the spinoff o= f its core trading business, bankrupt Enron Corp. (ENE) now stands to get a= smaller-than-expected interim financing package. Bankers are putting final touches on a downsized debtor-in-possession, or D= IP, financing deal under which the energy company will have access to up to= $700 million to $800 million, people familiar with the situation said.=20 That's half of what the company was first expected to receive.=20 Enron confirmed earlier Tuesday that it has entered a trading partnership w= ith Swiss banking institution UBS Warburg (U.UBS). Under the deal, UBS will= acquire all of Enron's oil and power trading business without cash changin= g hands. UBS won't take on any of Enron's liabilities, but Enron will recei= ve a 33% share of the new venture profits for at least two years.=20 Under the original financing plan approved last month shortly after Enron f= iled for Chapter 11 protection in New York, J.P. Morgan Chase & Co. (JPM) a= nd Citigroup (C) had agreed to put together a $1.5 billion interim financin= g deal to help the company back on its feet.=20 But continued apathy among bankers recruited to help J.P. Morgan Chase and = Citigroup foot the bill has now resulted in a smaller financing plan.=20 A first $250 million DIP installment was made available to the company in e= arly December. Enron has yet to tap that credit line.=20 An additional $250 million will likely become available over the next coupl= e of weeks after J.P. Morgan Chase and Citigroup approve the energy company= 's new business plan.=20 Additional financing above that $500 million is contingent upon other banks= agreeing to participate in the deal with J.P. Morgan Chase and Citigroup.= =20 Enron's new business plan, which was provided to the banks in early January= , has not been made public. But people familiar with the situation said the= company now has between $400 million and $500 million in available cash.= =20 That better-than-anticipated cash position is also cited as one of the reas= ons behind the DIP downsizing.=20 Final approval of the DIP, which is crucial for Enron to continue operating= , is now scheduled for Jan. 30.=20 Once they approve Enron's new business plan, J.P. Morgan Chase and Citigrou= p are expected to float a syndication term sheet to other large banks. The = banks first approached other financial institutions in mid-December, with t= he original $1.5 billion financing deal, but found that most were reluctant= to take on more exposure to Enron.=20 J.P. Morgan Chase's exposure to Enron stands at $2.6 billion. Meanwhile, Ci= tigroup's Enron liabilities are believed to be around $1 billion.=20 -By Carol S. Remond, Dow Jones Newswires, 201-938-2074; carol.remond@dowjon= es.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Enron Executives, Andersen Sued By Shareholder 01/15/2002 Dow Jones Energy Service (Copyright © 2002, Dow Jones & Company, Inc.) HOUSTON -(Dow Jones)- Executives of bankrupt Enron Corp. (ENE) were named a= s defendants in a class-action lawsuit filed Monday by an Enron shareholder= in federal court in Houston.=20 Also named as a defendant is Enron's auditing firm, Arthur Andersen L.L.P. The Enron shareholder, Howard Bruce Klein, alleges "each of the defendants = knew or recklessly disregarded the fact that...misleading statements and om= issions would adversely affect the integrity of the market in Enron common = stock. Had the adverse facts defendants concealed been properly disclosed, = Enron's shares would not have sold at the artificially inflated prices they= did," according to the filing.=20 Enron and Andersen representatives didn't reply to phone messages left at t= heir offices. In response to similar previous requests, Andersen spokesmen = have declined comment.=20 Klein is represented by Houston-based lawyer Tom Alan Cunningham.=20 The Enron executives named in the suit are Chairman Kenneth Lay, former Chi= ef Executive Jeffrey Skilling and former Chief Financial Officer Andrew Fas= tow.=20 Nearly 40 shareholder class-action lawsuits are pending against Enron in th= e U.S. District Court for the Southern District of Texas in Houston.=20 Enron filed for chapter 11 bankruptcy protection in December after the comp= any's equity collapsed in the face of revelations about of related party tr= ansactions involving executives including Fastow. The related party transac= tions kept hundreds of millions of dollars off Enron's balance sheet. The c= ompany is the subject of more than 60 civil lawsuits, congressional investi= gations and a federal criminal probe.=20 -By Erwin Seba, Dow Jones Newswires; 713-547-9214; erwin.seba@dowjones.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 UBS won't pay anything in deal for Enron trading operation By ALAN CLENDENNING AP Business Writer 01/15/2002 Associated Press Newswires Copyright 2002. The Associated Press. All Rights Reserved. NEW YORK (AP) - A Swiss investment bank won't pay anything to acquire Enron= Corp.'s energy trading business nor assume any of the troubled company's d= ebts but will share a third of the energy operation's profits with Enron an= d its creditors.=20 Stamford, Conn.-based UBS Warburg, a division of Swiss banking giant UBS AG= , and Enron will file for approval of the deal with the Federal Trade Commi= ssion and the Justice Department within five business days, according to do= cuments filed Tuesday in U.S. Bankruptcy Court in Manhattan. The plan to revive Enron's trading business calls for UBS Warburg to purcha= se the unit without paying any cash up front, said Mark Palmer, an Enron sp= okesman.=20 Enron and its creditors will initially get 33 percent of the new business' = pretax profits and UBS Warburg the remainder, the documents indicate. After= three years, UBS Warburg can begin to buy out some of those profit-sharing= rights and eventually buy the rights to all of the profits.=20 "This is an extremely positive deal for Enron and its creditors that confir= ms the substantial value of Enron's trading operation," said Enron chief fi= nancial officer Jeff McMahon. "We believe this is a first step among many t= owards an overall plan of reorganization and planned emergence from bankrup= tcy."=20 Palmer said UBS Warburg is expected to lease Enron offices in Houston and e= mploy about 800 of the division's workers. Court documents also indicated t= hat UBS Warburg plans to lease Enron office space in Portland, Ore., Toront= o and Calgary, Alberta.=20 Enron's energy trading business generated about 90 percent of the company's= $101 billion in revenue in 2000. The deal does not include existing contra= cts Enron has to supply power, valued at between $6 billion and $7 billion.= =20 Enron collapsed late last year amid revelations of complex partnerships use= d to keep billions of dollars in debt off its books and mask financial prob= lems so it could continue to get cash and credit to run the trading busines= s.=20 UBS Warburg won the bidding for the trading operation, beating out Citigrou= p Inc., a large Enron creditor.=20 The investment bank was selected after intense negotiations during a court-= sponsored auction that began Thursday morning and ended more than 24 hours = later.=20 The deal with UBS Warburg is for 10 years, but allows the investment bank t= o to exercise a series of options to buy out Enron's profit-sharing agreeme= nt starting in the third year of the pact, Enron said in a statement.=20 A creditors' committee approved the deal, but other Enron creditors have qu= estioned it, saying they want more information about how the agreement was = reached and how the proceeds will be allocated.=20 The deal must be approved by Judge Arthur J. Gonzalez. A hearing is set for= Friday.=20 Some two dozen Enron creditors had already filed objections to the sale bef= ore the selection was announced. Dissatisfied creditors will have 10 days t= o appeal Gonzalez's ruling.=20 Before its collapse late last year, Enron was the world's largest energy me= rchant and the nation's seventh largest company by revenue. Enron differed = from competitors in its penchant for complex bets on everything under the s= un - advertising space, broadband, paper, the weather and more than 1,000 o= ther products.=20 Trading of Enron shares, which sold for $83 a year ago but have changed han= ds at no higher than $1 since December, has been halted since Friday on the= New York Stock Exchange pending the sale announcement. UBS' U.S.-traded sh= ares fell 4 cents to $49.17 Tuesday morning on the NYSE.=20 ---=20 On the Net:=20 http://www.enron.com Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Enron loans sting bank's bottom line 01/15/2002 Associated Press Newswires Copyright 2002. The Associated Press. All Rights Reserved. CHICAGO (AP) - Northern Trust Corp. says losses on loans to bankrupt Enron = Corp. have caused fourth-quarter earnings to fall short of Wall Street's ex= pectations.=20 Northern Trust reported net income fell 18 percent to $102.4 million, or 45= cents a diluted share, from $125.5 million, or 54 cents a share, during th= e same period last year. Thomson Financial/First Call said analysts expecte= d the Chicago-based banking and financial-services company to report result= s of 54 cents per share. Northern Trust says its results were dragged down by an increase in the amo= unt of money set aside to cover potential loan losses, from $5 million to $= 45 million. On Monday, the bank disclosed it had $43.5 million in outstandi= ng Enron-related loans, of which $24.6 million is in the form of loans unse= cured by collateral.=20 Chief Financial Officer Perry Pero said the bank has written off the $24.6 = million in unsecured loans.=20 Northern Trust was the trustee of Enron's 401(k) pension plan until the now= bankrupt energy trader transferred in October to another provider. The ban= k held the assets but had no investment discretion, according to spokeswoma= n Sue Rageas.=20 It was during the shift of trustees that a "lockdown" was imposed, barring = employees from altering their plan holdings. The bank remains a co-defendan= t with Enron in litigation brought by Enron workers angry because they were= not permitted to sell their Enron shares while their value was falling.=20 Houston-based Enron filed for Chapter 11 bankruptcy protection last month a= fter disclosing it used questionable bookkeeping practices to conceal the s= ize of its debt.=20 For the year, Northern Trust's net income was $487.5 million, or $2.11 a sh= are, up from $485.1 million, or $2.11 a share, a year earlier. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 ODJ Market Special: Bond Futures Rally On Enron Delisting 01/15/2002 Dow Jones Commodities Service (Copyright © 2002, Dow Jones & Company, Inc.) Chicago, Jan. 15 (OsterDowJones) - Treasury bonds are rallying at the=20 Chicago Board of Trade as investors respond to Enron's de-listing.=20 "The market is more sensitive to the Enron-Arthur Andersen issue than the=20 probability of a strong GDP number," said Nick Kalivas, Refco's assistant vice=20 president of financial research.=20 At 1230 CT, The Mar 30-year contract is 24 ticks higher, at 104-05,=20 and=20 Mar 10-year notes are up 10 ticks, at 107-01.=20 The New York Stock Exchange earlier said it was delisting Enron shares=20 after they had traded below the exchange's one-usd threshold for more than a=20 month.=20 ---=20 Kate Gibson, OsterDowJones, (312) 977-1673=20 kgibson@osterdowjones.com=20 1832GMT Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 CAPITAL VIEWS: Early Washington Noise On Budget, Enron By John Connor 01/15/2002 Dow Jones Capital Markets Report (Copyright © 2002, Dow Jones & Company, Inc.) A Dow Jones Newswires Column=20 WASHINGTON -(Dow Jones)- The pace will pick up soon in the Nation's Capital= in areas of interest to the business and financial communities. Congress returns to work next week, with Congressional Budget Office Direct= or Dan Crippen testifying Wednesday on the budget outlook before the Senate= Budget Committee. The next day, a Senate committee will hold the first of = many Enron hearings this year.=20 President George W. Bush will deliver his State of the Union Address Jan. 2= 9.=20 And the Federal Open Market Committee will announce its latest monetary pol= icy decision the following day, Jan. 30, which also will feature the Treasu= ry Department's quarterly refunding announcement.=20 President Bush will unveil his fiscal 2003 budget Feb. 4, which also is the= day when Enron Chairman and CEO Kenneth Lay is scheduled to testify before= two Congressional committees.=20 On Feb. 12, the Senate Banking Committee will hear, in the context of the E= nron debacle, from five former chairmen of the Securities and Exchange Comm= ission.=20 And sometime not long thereafter, in the latter part of February, Federal R= eserve Chairman Alan Greenspan will present what used to be known as his Hu= mphrey-Hawkins testimony.=20 Prospects of Congress enacting much if any meaningful legislation in this, = an election year, are slim, but there should be no shortage of noise, parti= cularly on the fiscal policy front as Democrats ask in wide-eyed wonder "wh= o lost the surplus?" while Republicans accuse the Democrats of trying to ra= ise everyone's taxes.=20 Veteran budget observer Stan Collender of Fleishman-Hillard Inc., said prel= iminary expectations are that the Administration's budget and CBO's January= forecast will show a fiscal 2003 deficit of between $10 billion and $25 bi= llion.=20 But he said those numbers aren't likely to include a variety of things that= will add to the red ink, and warned that the fiscal 2003 deficit will be w= ell above what is projected in January and February.=20 "A (2003) deficit of $100 billion or more is not out of the question," Coll= ender added.=20 And somewhere along the line, perhaps sooner rather than later (the Treasur= y has cited February as a potential pressure point) the $5.95 trillion debt= ceiling will have to be raised.=20 On Enron, the old Watergate line of then Sen. Howard Baker, R-Tenn., - "wha= t did he know and when did he know it" - is likely to get a thorough workou= t.=20 Subscribers can find Capital Views on:=20 Telerate page [4021]=20 Dow Jones Newswires by searching the code N/POV=20 Bloomberg by entering NI POV=20 Reuters by entering keyword Capital Views=20 (John Connor, a veteran observer of the financial markets and the Washingto= n scene, is Washington bureau chief for Dow Jones Newswires. He can be reac= hed by E-Mail at John.Connor@DowJones.Com) Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Lieberman Asked to Recuse Himself From Enron Probe 01/15/2002 PR Newswire (Copyright © 2002, PR Newswire) WASHINGTON, Jan. 15 /PRNewswire/ -- The following letter was sent today by = Peter Flaherty, President of the National Legal and Policy Center to Senato= r Joseph Lieberman:=20 I am writing to ask you to recuse yourself from any participation in the Se= nate Governmental Affairs Committee's upcoming hearing and consideration of= the Enron case. Last Thursday, Attorney General Ashcroft recused himself from the Enron cas= e the same day he received a letter from Rep. Henry Waxman in which Waxman = questioned the approximately $50,000 that had gone to committees affiliated= with Ashcroft by Enron-related individuals and groups.=20 As you know, the amount that you and committees affiliated with you receive= d from Enron interests, Enron's top creditor -- Citigroup, Inc. and Enron's= auditor, Arthur Anderson, dwarfed anything received by Attorney General As= hcroft.=20 Enron contributed at total of $25,000 in 2000 to the group you founded, the= New Democrat Network, according to IRS records. Also, Enron's biggest cred= itor, Citigroup, Inc. is listed as your largest single contributor ($112,54= 6) for the period 1997-2002 by the web site Opensecrets.org, relying on Fed= eral Election Commission records. Citigroup, Inc. also made $100,000 in con= tributions to the New Democrat Network in 2001. Arthur Andersen, Enron's au= diting firm, contributed $20,000 to the New Democrat Network in 2001.=20 In order to assure the public of the integrity of the Senate investigation = and to avoid the appearance of a double standard, I hope you agree with me = that recusing yourself is the only appropriate step for you to take.=20 NLPC is a nonpartisan, nonprofit foundation promoting ethics and accountabi= lity in government through research, education and legal action.=20 MAKE YOUR OPINION COUNT - Click Here=20 http://tbutton.prnewswire.com/prn/11690X60795515 /CONTACT: Peter Flaherty or Patrick Chisholm, both of the National Legal an= d Policy Center, +1-703-237-1970/ 15:03 EST=20 Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Sen. Lieberman Asked to Recuse Himself From Enron Probe 01/15/2002 Dow Jones Energy Service (Copyright © 2002, Dow Jones & Company, Inc.) WASHINGTON -(Dow Jones)- The National Legal and Policy Center, or NLPC, ask= ed U.S. Senator Joseph Lieberman to recuse himself from any participation i= n the Senate Governmental Affairs Committee's upcoming hearing and consider= ation of the Enron Corp. (ENE) case.=20 In a press release Tuesday, the NLPC said Lieberman and committees affiliat= ed with him received funds from Enron and Enron interests that made recusal= the "only appropriate step" to assure the public of the integrity of the S= enate investigation. Specifically, the NLPC said the amount that Lieberman, a Democrat from Conn= ecticut, and committees affiliated with him received far exceeded the rough= ly $50,000 that went to committees affiliated with U.S. Attorney General Jo= hn Ashcroft, who recused himself last week.=20 Senator Lieberman wasn't immediately available for comment. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 O'Neill says 'something clearly went awry' with Enron information disclosur= e 01/15/2002 AFX News © 2002 by AFP-Extel News Ltd NEW YORK (AFX) - Treasury Secretary Paul O'Neill said something clearly wen= t wrong with Enron Corp's disclosure of financial information, and employee= s of the firm will be punished if rules were broken.=20 O'Neill said "something clearly went awry" in Enron's disclosure of financi= al information, in remarks to the National Retail Federation here. In the US system of information disclosure, "individuals...are confident th= at they have the information they need to make sound decisions and the abil= ity to act on that information as they see fit."=20 But "in the Enron case, something clearly went awry," he said.=20 "If anyone at Enron broke the rules, they will be punished," he concluded, = noting the Justice Department's investigation.=20 cxa/gc Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 USA: Treasury's O'Neill sees positive US economic signs. 01/15/2002 Reuters English News Service (C) Reuters Limited 2002. WASHINGTON, Jan 15 (Reuters) - Treasury Secretary Paul O'Neill said on Tues= day that he now saw some signs of positive growth among the mixed signals t= he U.S. economy was giving off.=20 "The data that I'm looking at tell me the economy is and has been moving fr= om a slow period to one where the data is kind of mixed and we are seeing s= ome positives," O'Neill said on CNBC television. "But I think the balance is now decidedly on the positive side and I think = it foretells movement back into significant positive growth as we go throug= h the year," he added.=20 The Treasury chief, in New York to address a business group, said the econo= my should get a short-term lift simply from restocking inventories. After t= hat, O'Neill added, "we need to kick in the investment side of business act= ivity" to get a sustained recovery from recession that began last march.=20 "But that's the uncertainty that we have, that the inventory reversal and m= ovement back up will be followed by business investment picking up more of = the???ed.=20 In response to a question, O'Neill said he has not given up on reviving a p= ackage of economic stimulus measures to spur growth. A proposed package fai= led at the end of last year amid acrimony on Capitol Hill over how best to = craft measures but O'Neill said he thought lawmakers might have changed the= ir minds by now.=20 If so, "we're very hopeful we can get it done in a few weeks," O'Neill adde= d.=20 He said there should not be a rush to judgment about what happened in the c= ase of bankrupt energy trader Enron Corp. but said if it was shown that the= re were legal violations that contributed to its collapse, then there shoul= d be punishment.=20 "I believe this: if people knowingly, intentionally violated the law, then = they should be brought to justice," O'Neill said. Enron and its former offi= cers are under investigation on several fronts.=20 Enron was a major contributor to the successful presidential campaign of Ge= orge W. Bush but gave money to both Republicans and Democrats who were seek= ing office. O'Neill said he was not concerned that Enron had undue influenc= e over lawmakers or over the shaping of national energy policy.=20 He said it was natural for people crafting energy policy and for lawmakers = to talk to experts on the topic.=20 "If you really followed the dictates of the people who are on the extreme e= dges of this, you would only talk to people who don't know anything, which = doesn't seem to be a brilliant idea to me," O'Neill added. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Nevada Sen. Ensign on panel probing Enron 01/15/2002 Associated Press Newswires Copyright 2002. The Associated Press. All Rights Reserved. WASHINGTON (AP) - Sen. John Ensign, R-Nev., who is among numerous lawmakers= who took campaign money from Enron Corp., is also among those investigatin= g the firm's collapse.=20 Ensign took $7,500 in campaign contributions from Enron since 1989, accordi= ng to the Center for Responsive Politics, a campaign-money watchdog group. Ensign is on the Senate Commerce Committee, and the panel's consumer affair= s subcommittee, which is holding hearings on Enron's collapse.=20 Ensign said the contributions "absolutely" wouldn't hinder his ability to r= igorously investigate how Enron plummeted into bankruptcy and left investor= s, including company employees, holding nearly worthless stock.=20 Ensign stressed that the Justice Department was the lead Enron investigator= .=20 "As it appears, fraud took place," Ensign said. "If that's the case, Justic= e needs to put some people in jail. It's very unfortunate that we had peopl= e perpetrate this sort of thing, especially when you are dealing with emplo= yees and the top people were trying to protect their own rear ends."=20 Ensign also said the Bush administration should be lauded for not stepping = in to help Enron, whose executives gave sizable donations to the president.= =20 As many as eight congressional committees plan to look into Enron, but Comm= erce was among the first to get started. Seventy-one senators and 188 House= members - more than half of Congress - got money from Enron, according to = the center.=20 One other Nevada lawmaker has taken money from Enron in recent years: Sen. = Harry Reid, D-Nev., got $1,000 in 1998. Reid doesn't sit on any committee t= hat intends to investigate the Enron debacle. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Enron, which lobbied for corporate tax repeal, faces Congress probe over it= s own tax returns By CURT ANDERSON AP Tax Writer 01/15/2002 Associated Press Newswires Copyright 2002. The Associated Press. All Rights Reserved. WASHINGTON (AP) - Enron Corp., which led a lobbying campaign to repeal a co= rporate tax as it neared collapse, will undergo scrutiny in Congress of its= own tax returns to determine if shelters or other practices may have conce= aled its financial condition.=20 Repeal of the alternative minimum tax sought by Enron was included by Presi= dent Bush in an economic stimulus package and passed by the House, which ad= ded a provision that would have given Enron a $254 million infusion of cash= . The package ultimately failed. Now, Senate Finance Committee investigators are "interested in whether Enro= n has been complying with federal tax laws" said the panel's spokesman, Mik= e Siegel.=20 Whether Enron used any shelters viewed by the Internal Revenue Service as s= et up mainly to avoid paying taxes is one key point. Sen. Charles Grassley = of Iowa, the top committee Republican, said the issue is "whether Enron use= d certain tax vehicles that might have masked the company's financial condi= tion."=20 Enron, the Houston-based energy conglomerate, faces investigations from a g= rowing list of congressional committees, the Justice Department and the Sec= urities and Exchange Commission following its collapse late last year in th= e nation's biggest corporate bankruptcy. The Finance Committee is one of tw= o congressional panels with access to Enron's tax records.=20 Even as its failure loomed last fall, Enron maintained a high-profile lobby= ing effort on a variety of tax issues. Enron led the AMT Coalition for Econ= omic Growth, a business group dedicated to repeal of the corporate alternat= ive minimum tax, which is intended to guarantee that companies pay at least= a minimal amount of income taxes.=20 Bush also pushed for repeal in his economic stimulus package, arguing that = the provision hits corporations hardest in down years.=20 The administration disclosed Tuesday that Enron Chairman Kenneth Lay+ telep= honed Mitch Daniels, director of the White House Office of Management and B= udget, in early October to discuss prospects for passage of the stimulus me= asure.=20 The two had a general conversation about the legislation and discussed the = overall outlook for the economy, said OMB spokeswoman Amy Call. Repeal of t= he alternative minimum tax was not addressed, she said.=20 Enron stood to gain handsomely from language added to the stimulus package = by Rep. Bill Thomas, R-Calif., chairman of the House Ways and Means Committ= ee. Under the original House-passed bill, billions of dollars in alternativ= e minimum tax credits built up over past years by dozens of corporations wo= uld have been immediately redeemed - handing Enron a $254 million infusion = of cash.=20 Several corporate lobbyists say Enron was focused on prospective repeal of = the tax, not the immediate refund of past credits. Thomas endured fierce cr= iticism from Democrats for proposing the refunds, which he contended would = enable struggling corporations to hire more people or boost investments. Ot= her companies, including IBM and General Motors, would have gotten much lar= ger refunds than Enron.=20 David Wyss, chief economist at Standard & Poor's Co. in New York, said in a= ny event the money would have done little to help Enron overcome its sinkin= g credit rating and sliding stock price.=20 "Maybe they could have staved off bankruptcy for another month," Wyss said.= "But it would not have solved their problem."=20 Senate Democrats blocked the Republican stimulus package. A second version,= again passed by the House and endorsed by Bush, did not include the altern= ative minimum tax repeal or the immediate refund.=20 Enron sought numerous other tax breaks from Congress, according to lobbyist= disclosure records. Among them was a five-year extension of a tax credit f= or electricity generated by wind; Enron is a major producer of wind-generat= ed power.=20 An Enron affiliate, Enron Wind, provided a sample letter on its Internet si= te that people could send to members of Congress advocating extension of th= e credit.=20 Like the stimulus package, however, extension of the wind credit failed to = clear Congress and expired on Dec. 31. Lawmakers of both parties say it wil= l be renewed for at least another year and probably made retroactive to the= beginning of 2002.=20 Enron would also have benefited from provisions of a House-passed energy bi= ll involving oil and gas transmission lines, including tax breaks for certa= in transmission transactions. Those items would have helped the bottom line= s of many other companies, too - and the bill also languishes in the Senate= . Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Fired Andersen Executive Says He Followed Company Orders By Judith Burns 01/15/2002 Dow Jones News Service (Copyright © 2002, Dow Jones & Company, Inc.) Of DOW JONES NEWSWIRES=20 WASHINGTON -(Dow Jones)- David Duncan, fired by Arthur Andersen Tuesday for= his alleged role in destroying documents on Enron Corp. (ENE), was only fo= llowing orders from Andersen's own attorneys, a spokesman said. "Mr. Duncan is cooperating with all investigations of this matter. He did n= othing wrong. He followed the instructions of an Andersen in-house lawyer i= n handling documents," the spokesman said.=20 Andersen dismissed Duncan, saying it found widespread destruction of Enron-= related materials after he called an Oct. 23 meeting.=20 Chicago-based Andersen said an Oct. 12 memo from a company attorney on the = firm's document retention policy doesn't appear to have prompted the destru= ction of electronic and paper records related to Enron. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 USA: UPDATE 1-Fired Andersen partner to meet investigators Wed. By Jeremy Pelofsky 01/15/2002 Reuters English News Service (C) Reuters Limited 2002. WASHINGTON, Jan 15 (Reuters) - David Duncan, who was fired on Tuesday by au= ditor Andersen for his alleged role in destroying documents related to its = review of Enron Corp.'s books, will meet with congressional investigators o= n Wednesday, a spokesman for the U.S. House Energy and Commerce Committee s= aid Tuesday.=20 "Mr. Duncan will be meeting with our investigators tomorrow," said Ken John= son, the spokesman told Reuters on Tuesday. The panel has been probing Ande= rsen's role in the collapse of the energy trading giant last fall. "Frankly, now that he's been fired, he may be a little more motivated to be= cooperative," Johnson said. "Prior to being terminated, he delivered six b= oxes of personal files and records to the committee and we're in the proces= s of reviewing them right now."=20 Earlier on Tuesday, Andersen said thousands of e-mails and large numbers of= paper documents related to Enron were destroyed shortly after lead partner= Duncan learned on Oct. 23 of a request by the Securities and Exchange Comm= ission for information about the audit of Enron.=20 Duncan could not be reached immediately for comment.=20 The House Energy and Commerce Committee also said it would meet later with = Sherron Watkins, the Enron executive who wrote a letter to Chief Executive = Kenneth Lay last August in which she raised concerns about the company's ac= counting.=20 "We're in the process of setting up a meeting with her," Johnson said at a = press briefing. FIRST STEP TO ASSIGN BLAME=20 The firing of Duncan was the first public step by the accounting firm to as= sign individual blame for the problems with its Enron audits. The Houston-b= ased energy giant last month filed for the largest bankruptcy in U.S. histo= ry.=20 Three other partners responsible for the Enron work were placed on leave by= Andersen.=20 "This is a useful beginning, but there is much more to be done," Rep. John = Dingell, the ranking Democrat on the House panel, said in a statement read = by his spokeswoman.=20 The collapse of the company came after posting its first quarterly loss in = more than four years on Oct. 16, as it took $1 billion in charges against e= arnings and cut shareholders equity by $1.2 billion.=20 Enron debt was listed under partnerships, considered special-purpose entiti= es, in effect keeping the debt off its own books. Andersen was responsible = for auditing the company's balance sheets.=20 Earlier on Tuesday, the New York Stock Exchange formally suspended trading = in Enron shares and related securities while moving to delist the stock. It= s shares last traded for 67 cents on Jan. 10, far below the record $90.56 h= it in August 2000. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 ROUNDUP Andersen fires Enron auditor who knowingly destroyed documents 01/15/2002 AFX News © 2002 by AFP-Extel News Ltd NEW YORK (AFX) - Arthur Andersen LLP said it has fired the leading partner = on its Enron audit after it discovered he ordered documents to be destroyed= even after learning that the Securities and Exchange Committee wanted to s= ee them.=20 The Big Five firm said it has dismissed David Duncan and sent three other p= artners involved in the case on administrative leave. Andersen said its initial probe of the Enron matter revealed that Duncan or= dered employees to destroy thousands of emails and numerous related papers.= =20 "These activities were on such a scale and of such a nature as to remove an= y doubt that Andersen's policies and reasonable good judgment were violated= ," the firm said.=20 The effort began following an urgent meeting that Duncan called on Oct 23, = shortly after learning that Enron had received a request from the SEC for i= nformation on its financial accounting and reporting.=20 "This effort was undertaken without any consultation with others in the fir= m and at a time when the engagement team should have had serious questions = about their actions," said Andersen.=20 The firm denied that an Oct 12 e-mail referring to company policy in docume= nt handling or any other conversations it knew of around that time had auth= orized the activity.=20 Most of the emails and documents were destroyed in the days following that = meeting, although the activity only ended after the lead partner's assistan= t sent an e-mail to other secretaries on November 9 -- one day after Anders= en received a subpoena from the SEC -- telling them to "stop the shredding"= , said the firm.=20 Andersen reiterated its statement of last week that it has successfully ret= rieved some documents from electronic backup systems, and said it is attemp= ting to restore more.=20 The firm also said that is installing new management in its Houston offices= , where the audit team was based.=20 Andersen managing partner and chief executive officer Joseph Berardino said= : "We promised to be forthright and to take action where appropriate. This = was a painful decision, but it was absolutely the right thing to do. We are= prepared to take all appropriate steps necessary to maintain confidence in= the integrity of our firm."=20 Arthur Andersen said it would dismiss anyone found to have improperly destr= oyed audit work papers as well as any employee found to have purposefully d= eleted Enron-related e-mails or destroyed Enron-related documents after hav= ing been informed of the November 8 subpoena.=20 "Based on our actions today, it should be perfectly clear that Andersen wil= l not tolerate unethical behavior, gross errors in judgment or willful viol= ation of our policies," said Berardino.=20 Andersen's revelations came shortly after the New York Stock Exchange said = it is delisting Enron shares with immediate effect.=20 It attributed the move to the "expected protracted nature of the company's = bankruptcy process and the uncertainty at this time as to the timing and ou= tcome of this process as well as the ultimate effect on the company's commo= n shareholders."=20 The shares have also fallen below the exchange's one usd threshold for more= than a month.=20 Enron shares have been halted from trading for the past several days pendin= g the announcement of details of the company's sale of its wholesale energy= trading unit to UBS Warburg. They last changed hands at 67 cents.=20 Earlier, Enron said that UBS Warburg will not pay any cash upfront to acqui= re the unit, but will instead pay Enron royalties equal to 33 pct of the un= it's income for 10 years.=20 UBS Warburg has a series of options that allow it to begin buying out Enron= 's royalty interest in the third year of the agreement.=20 Following the exercise of the first call, the royalty payment rate will dro= p from 33 pct to 22 pct. A second option in the fourth year would lower roy= alties payments to 11 pct. The final option in the fifth year would allow p= ayments to cease altogether.=20 If UBS Warburg decides not to exercise these series of options, the royalti= es will increase from year five through 10.=20 UBS is acquiring a staff of about 800 people along with the company's compu= ter systems and hardware.=20 Additionally, as Enron lawyers made clear on Friday, the company's trading = book is not part of the deal.=20 The book contains Enron's derivatives trading positions, which will be slow= ly unwound.=20 The deal still requires approval by Judge Arthur Gonzalez of the US bankrup= tcy court in the Southern District of New York.=20 The court is expected to announce that decision on Friday.=20 cl/blms/law/gc Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Arthur Andersen fires chief Enron auditor; 3 other partners sent on leave 01/15/2002 AFX News © 2002 by AFP-Extel News Ltd NEW YORK (AFX) - Arthur Andersen LLP said it fired David Duncan, the lead p= artner on its Enron Corp audit, and will send three other partners involved= in the case on administrative leave.=20 Arthur Andersen said the three partners to be sent on leave are Thomas Baue= r, Debra Cash, and Roger Willard, who were all asssigned, along with Duncan= , to its Houston offices. The accounting firm said its probe of the Enron matter revealed that thousa= nds of emails were destroyed and numerous related papers rushedly destroyed= after the US Securities and Exchange Commission issued a subpoena for such= documents on Nov 8.=20 The destruction of the Enron-related documents was ordered by Duncan, it sa= id.=20 Arthur Andersen said it believes that its own policies of "reasonable good = judgment" were violated by the four partners.=20 Arthur Andersen said its inquiry into the destruction of the Enron-related = documents is continuing and that additional persons, beyond the four identi= fied today, are being probed.=20 It said it will take action against any employee found to have purposefully= deleted Enron-related audit work papers, emails or documents after learnin= g on Nov 8 that such materials were being subpoenaed by the SEC.=20 It reiterated its statement of last week that it has successfully retrieved= some documents from electronic backup systems, and said it is attempting t= o restore more such documents.=20 The accounting firms said the dismissal of Duncan and the placement of the = other three partners on leave were based on "preliminary facts relating to = Andersen's inquiry into the disposal of documents related to the action."= =20 Arthur Andersen also said it is installing new management in the Houston of= fices.=20 Arthur Andersen managing partner and chief executive officer Joseph Beradin= o said: "We promised to be forthright and to take action where appropriate.= This was a painful decision, but it was absolutely the right thing to do. = We are prepared to take all appropriate steps necessary to maintain confide= nce in the integrity of our firm."=20 law/gc Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 USA: Business group wary of new regs from Enron case. By Peter Kaplan 01/15/2002 Reuters English News Service (C) Reuters Limited 2002. WASHINGTON, Jan 15 (Reuters) - The head of corporate America's biggest lobb= ying group on Tuesday said the government should not rush to impose new bus= iness regulations in the wake of Enron Corp.'s collapse.=20 Thomas Donahue, the president of the U.S. Chamber of Commerce, said the org= anization would oppose any immediate, "radical overhaul" of laws and regula= tions stemming from the Enron debacle. "We have seen one problem with one company and one accounting firm, and wit= h it everybody is rushing to judgment and rushing to: 'We've got to pass le= gislation,'" Donahue said at a press briefing on the Chamber's 2002 agenda.= "Pray we don't until we know what we're talking about."=20 Houston-based Enron filed the largest bankruptcy in U.S. history on Dec. 2.= Its auditor, Andersen, has said its employees destroyed documents related = to the former energy giant's balance sheet.=20 Enron's collapse has prompted a criminal probe by the Justice Department. T= he Securities and Exchange Commission and Labor Department are also investi= gating.=20 President George W. Bush ordered a review headed by Treasury Secretary Paul= O'Neill of U.S. pension and corporate disclosure rules to avoid a repeat o= f the energy trading firm's collapse, in which thousands of employees lost = their retirement savings.=20 Meanwhile, some lawmakers in Congress are eyeing possible legislation to pr= otect investors and employees from similar breakdowns in future.=20 Sens. Jon Corzine, a Democrat from New Jersey, and Barbara Boxer, a Democra= t from California, have proposed a law limiting how much company stock can = be put into employees' 401(k) plans. Sen. Paul Sarbanes, a Democrat from Ma= ryland, has asked the General Accounting Office to look into the adequacy o= f financial reporting and employee retirement plan rules.=20 Florida Democratic Sen. Bill Nelson has said he also is considering legisla= tion to protect 401(k) account holders' rights to sell shares when they wan= t. And the Federal Energy Regulatory Commission has proposed new requiremen= ts for reporting on derivatives and hedge funds.=20 Another Chamber of Commerce official at the briefing said the organization = does support a bill by Ohio Republican Rep. John Boehner that would let ret= irement plans providers offer investment advice to individual plan members.= =20 But Donahue, of the Chamber of Commerce, said the president and Congress sh= ould move cautiously when it comes to more radical measures. He characteriz= ed the Enron collapse as an isolated case and said there are already rules = and regulations in place to protect investors.=20 "Let's not start reinventing the process," Donahue said. "Let's adjudicate = the process that's in place."=20 "After that's done, if there's a habitual problem in American industry and = the American accounting industry because of that then we have to change the= system," Donahue said. "Right now there is no such habitual problem."=20 Donahue said class-action attorneys "are lining up now to see if they can l= ine their pockets on behalf of some number of shareholders from anybody the= y can target on this." Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 USA: US official sees Enron slowing energy mart change. 01/15/2002 Reuters English News Service (C) Reuters Limited 2002. WASHINGTON, Jan 15 (Reuters) - The Enron Corp. debacle won't end federal an= d state efforts to further restructure U.S. energy markets, but it will slo= w the process for the next two or three years, a top Bush administration en= ergy official said on Tuesday.=20 "I think we've gone too far to go back," said Vicky Bailey, Assistant Secre= tary of Energy for International Affairs and Domestic Policy. Bailey, speaking to reporters at a U.S.-Canada energy conference, said that= Enron's problems along with last year's California energy crisis will drag= out the process of bringing more competition to the nation's electricity m= arket.=20 "You've got the bookends of the California crisis and Enron. It doesn't hel= p," Bailey said. It slows (restructuring efforts) down for probably two or = three more years."=20 Bailey said it was unfortunate that the Enron fiasco would effect energy re= structuring, because energy issues were not the cause of the company's down= fall.=20 "The Enron issue is a financial issue, banking issue, accounting issue," sh= e said. "It shouldn't be the death knell for energy legislation, because th= at's larger than Enron."=20 During the seven years that Bailey served as a member of the Federal Energy= Regulatory Commission, she said Enron officials were "out front" and "aggr= essive" in pushing to open U.S. energy markets to competition.=20 "There was nothing wrong with that. We needed somebody out there championin= g that," said Bailey, referring to Enron.=20 With congressional scrutiny of Enron, Bailey said she did not think another= energy firm would be willing to step in any time soon to become the new ch= eerleader for restructured energy markets. "I think you'll see a fair amoun= t of timidness," she said. Copyright ? 2000 Dow Jones & Company, Inc. All Rights Reserved. =09 Power Trading Business Could Be Good Fit For UBS Warburg By Cheryl Winokur Munk and Christina Cheddar 01/15/2002 Dow Jones Energy Service (Copyright © 2002, Dow Jones & Company, Inc.) Of DOW JONES NEWSWIRES=20 NEW YORK -(Dow Jones)- UBS Warburg's winning bid for Enron Corp.'s (ENE) po= wer trading business could prove to be a good strategic move for the Swiss = investment bank, analysts said. The purchase of Enron's trading operations marks UBS Warburg's entry into a= new business line that adds to its experience in equity and fixed-income t= rading. The deal is in line with UBS's stated goal to expand its U.S. marke= t share, a focus since its 2000 purchase of brokerage firm PaineWebber Inc.= =20 "It will be a valuable extension of our worldwide trading activities," said= John Costas, chief executive of UBS Warburg in a recent statement.=20 Enron's demonstrated track record and high-quality traders offer "potential= ly a very complimentary fit to the trading operations of a brokerage firm,"= said Gene Pisasale, senior investment officer with Wilmington Trust Co.=20 Although observers are skeptical that the trading unit could reclaim its to= p dog status in the power trading industry, UBS's backing could revive the = business that has been virtually dormant since Enron's bankruptcy in early = December.=20 Putting UBS's name behind it should eliminate concerns about the soundness = of the business, said John Leonard, an analyst with Schroder Salomon Smith = Barney in London.=20 "I don't think that UBS is taking a lot of risk," said Romain Burnand, Euro= pean bank analyst at J.P. Morgan in London. He said UBS's risk seems to be = limited to potential negative cash flow if the trading activity does not re= sume quickly enough.=20 A spokesman for UBS Warburg, a unit of UBS AG (UBS), did not immediately re= turn telephone calls seeking comment.=20 Still, there are questions about just how much business Enron's old trading= operation can recapture under UBS control, given the already crowded indus= try playing field. Enron had about 20% of the market, said Leonard of Schro= der Salomon Smith Barney.=20 UBS will be armed with Enron's technology and the talent of some of its emp= loyees. According to a person familiar with the transaction, UBS is expecte= d to keep between 500 to 800 of Enron's employees.=20 The staff will include executives who ran Enron's trading floor, but not an= y of Enron's corporate employees, the person said.=20 Since trading is a relationship business, the retention of key staff is an = important part of the picture. However, there are concerns among industry w= atchers that Enron's staff may have lost important momentum in the weeks th= at Enron's business wasn't operating.=20 "Enron's trading business was so big," said Commerzbank Securities analyst = Andre Meade. "It had such a big market share that it had an information adv= antage that is unlikely to persist."=20 Also, having gone through the painful adjustment of having to operate witho= ut Enron, some customers may be hesitant to go back, according to Meade.=20 Indeed, the energy market has moved on since Enron's abrupt exit and typica= lly new entrants in the energy market have had difficulty obtaining top-tie= r status. However, since many energy traders have credit ratings below A-le= vel, UBS may have an edge over its competition, some industry observers sai= d.=20 UBS is rated Double-A-Plus, and good credit goes a long way in the energy m= arket.=20 "It's a question of stability," said ABN AMRO energy analyst Paul Patterson= . "What you find is that it gives (trading partners) more confidence."=20 The importance of confidence among trading partners cannot be overstated. M= any likened Enron's own collapse to a run on a bank. As the trading parties= rushed to unwind their deals, Enron's situation began to spiral out of con= trol.=20 Historically, energy traders with Triple-B credits haven't been penalized, = for their lower credit ratings, but that situation may be evolving post-Enr= on.=20 For that reason, it is important for UBS to maintain its status, observers = said.=20 UBS hasn't indicated whether it will seek a separate rating for the trading= business, as is the case with many energy trading companies.=20 A person familiar with UBS said the credit of UBS' trading business will li= kely be considered along with the credit of its parent. However, credit rat= ing agencies will make the final determination.=20 Officials from Standard & Poor's and Moody's Investors Service weren't imme= diately available to comment.=20 Eileen Fahey, a banking industry analyst for Fitch Investors Service, said = the addition of the trading business adds an element of risk to UBS's profi= le.=20 "It's a new business for them. They had scaled down their commodities tradi= ng," she said. However, the analyst sees the move as consistent with UBS Wa= rburg's strategy of becoming a large, core investment bank.=20 Furthermore, UBS has the advantage of buying "a premiere platform," accordi= ng to Fahey.=20 Historically, the strength of the UBS credit rating has been based on the s= trength of its private client business and the support of the Swiss governm= ent, she said. However, neither of these strengths are applicable to the en= ergy trading business.=20 Fitch's review will look closely at how much capital the business will requ= ire, how much liquidity the business can generate and in which areas will t= he company focus. These details are unknown at this time.=20 Reached later, UBS spokesman David Walker declined to provide details about= the new venture until after the bankruptcy cou
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