Enron Chiefs Sued for 25 Billion

BBC News - Business Section ^ | 12-08-01 | Steven Evans

[horsewhispersc]

Enron chiefs sued for $25bn

The suit alleges insiders sold before the fall

By the BBC's North America business correspondent, Stephen Evans

Top executives at the huge American energy company Enron are being sued for $25bn.

One of the company's shareholders, the New York-based Amalgamated Bank, alleges that the executives sold millions of shares when they knew the plight of the company.

Enron is a grotesque fraud - a financial monstrosity of manipulation and falsification Amalgamated Bank's lawsuit

The Amalgamated Bank of New York is a big shareholder in Enron and so lost many millions of dollars when the share price collapsed on the revelation of previously unknown debts of $13bn.

The bank alleges that executives at the top of Enron knew the true state of affairs and sold their shares before the price collapsed.

Fraud alleged

The bank is suing 29 current and former top Enron executives and board members, including Ken Lay, Enron chairman and chief executive, and Texas Senator Phil Gramm's wife, Wendy Gramm.

The former UK Minister, Lord Wakeham, is one of the non-executive directors of Enron, though there is no suggestion he acted improperly. The Amalgamated Bank says that Enron was a "grotesque fraud".

Apart from banks and energy companies which had contracts with Enron, the other main losers are the employees, most of whom had to invest in Enron shares as part of their pension.

There is now a mass of litigation under way. The problem is that Enron has drowned in debt, leaving nothing to pay anybody.

[horsewhispersc]

I wonder if this is the reason Gramm is stepping down.

Be kind my first major article posted! lol

[Hillary 666]

Enron is a grotesque fraud - a financial monstrosity of manipulation and falsification

Sounds like the "dot-com revolution" that recently crashed and burned.

[horsewhispersc]

Doesn't look good does it

[Shermy]

Those bank lawyers won't put up with any "poor us," "it's the economy", or "wave the flag" defenses. Should be a fun story for months to come. Now if some bank could sue the baseball owners...

[GOPcapitalist]

Ken Lay gets what he deserves. He's a RINO sellout who pretends to be a Republican when it is convenient, but turns around and holds fundraisers for Democrats when they'll build him and his millionairre buddies sports stadiums and light rail lines.

Lay and Enron held a big 250,000 Lee P. Brown reelection fundraiser high atop their soon-to-be-repoed downtown office building just a few weeks before the company went belly up. Call it justice.

And sorry in advance to any freepers who were enron stock owners. You picked a corrupt scumbag company that also happens to pull the strings at the democrat houston mayor's office to invest in.

[Shermy]

"A financial monstrosity..." Well, I'm glad good ol' American knowhow proves its darkside is the equal to any in the world. The BCCI case made me think we had a crook gap.

[horsewhispersc]

Sue the baseball owners, there ya go. They should they've ruined the game. This is going to be interesting suit to watch to say the least!

[Timesink]

It should be noted that Amalgamated is about as close to a lefty socialist institution as any American bank can possibly get. They're the bank all the hardcore ultra-angry liberal union types patronize in NYC; the few ads they run are filled with multiculti hardhats and civil servants. They don't even have a web site, to my knowledge, and their HQ is on Union Square.

In other words, I could take this lawsuit seriously if it were being launched by ANY other financial institution in the United States, except this one. If there's any bank that would be out purely to put the screws to some capitalists, it's Amalgamated.

[lewislynn]

Enron is a grotesque fraud - a financial monstrosity of manipulation and falsification Amalgamated Bank's lawsuit

This is the same Enron that the energy groupies (you know who you are) defended when because it was suggested by Gray Davis they price gouged California citizens through a phony Republican "deregulation" scam...

Why would anyone think a company like Enron would gouge California, or an other state's citizens?< /sarcasm >

[lewislynn]

It's just beginning.

Charitable Fund Sues Enron Directors and Arthur Anderson

[Libertarian_4_eva]

Lay and Enron held a big 250,000 Lee P. Brown reelection fundraiser high atop their soon-to-be-repoed downtown office building just a few weeks before the company went belly up. Call it justice.

Enron was also the biggest supporter of Pres Bush and many people in the admin had stocks in enron. This is going to be the whitewater for president bush. The democrats are already getting ready to have hearings on this and will use it to attack him.

[horsewhispersc]

LOL, Does anyone think this is the reason Phil Gramm is stepping down, because of his wife's involvement?

[horsewhispersc]

The other day I was told that there was a streamline on Fox News that Bush had hired a Law firm that has 200 power house Att'ys, I didn't see it as I don't have TV, but t makes sense to me now.

[Southack]

Gee, how could Enron be a fraud if it was audited by Big-5 Arthur Andersen??

< /SARCASM >

[Southack]

"Enron was also the biggest supporter of Pres Bush..."

One of many problems with Libertarians is that they tend to exaggerate "facts" just a wee bit...

Top Contributors
Donor Lookup
 

	OTHER DATA:
	• Bush's Cabinet • First 100 Days • Bush's Energy Plan • Top Fundraisers • Personal Finances • Florida Recount • Inaugural Donors • Texas Gubernatorial Contributions

FORMAT TO PRINT

THE CENTER
FOR RESPONSIVE
POLITICS

PRESIDENT GEORGE W. BUSH
Top Contributors

MBNA Corp	$240,675
Vinson & Elkins	$202,850
Credit Suisse First Boston	$191,400
Ernst & Young	$179,949
Andersen Worldwide	$145,650
Morgan Stanley Dean Witter & Co	$144,900
Merrill Lynch	$132,425
PricewaterhouseCoopers	$127,798
Baker & Botts	$116,121
Citigroup Inc	$114,300
Goldman Sachs Group	$113,999
Enron Corp	$113,800
Bank of America	$112,500
KPMG LLP	$107,744
Jenkens & Gilchrist	$105,450
Enterprise Rent-A-Car	$97,498
State of Texas	$87,254
American General Corp	$84,134
Deloitte & Touche	$81,600

METHODOLOGY: The organizations listed here came from two sources: either they were the sponsor of a PAC that donated to the member, or they were listed as individual donor's employer. Donors who give more than $200 must provide information on their occupation and employer.

In cases where two or more people from the same family contributed, the income-earner's occupation/employer is assigned to all family members. If, for instance, Henry Jones lists his employer as First National Bank, his wife Matilda lists "Homemaker" and 12-year old Tammy shows up as "Student," the Center would identify all their contributions as being related to the "First National Bank" since that's the source of the family's income.

NOTE: All the numbers on this page are for the 1999-2000 election cycle and based on Federal Election Commission data released on October 1, 2001. Feel free to distribute or cite this material, but please credit the Center for Responsive Politics.

[lewislynn]

Enron was also the biggest supporter of Pres Bush

Actually it wasn't Enron, it was the CEO, Lay...

[horsewhispersc]

Thanks Southack, looks like I'll be reading for awhile! ;-)

[Southack]

"This is the same Enron that the energy groupies (you know who you are) defended when because it was suggested by Gray Davis they price gouged California..."

Looking at Enron in that light brings up a few minor problems.

1. Who will you blame for "price gouging" when electricity rates skyrocket again next summer due to California's lack of power plants (since Enron won't be around to be a scapegoat any longer)?
2. Enron reported profits of only 0.6% on over $23 Billion in debt and $101 Billion in sales revenue. Most people associate real "price gougers" with slightly higher profit margins (instead of bankrupting the company via too much debt).
3. Enron's real crime was collaborating with Andersen to cook the 10-Q and 10-K audit reports. Those audits tricked investors and employees into thinking that their pension plans (which were full of Enron stock) were safe. It was their stock price, not the price of electricity, where the real fraud was perpetrated. Shifting focus away from the stock fraud by trying to save Gray Davis' from his electricity follies could very well cause the real crime to go unpunished.

[horsewhispersc]

Has the SEC ever stepped in?