Citigroup, Morgan Execs Questioned

AP | 7/26/02

[kattracks]

WASHINGTON, Jul 25, 2002 (AP Online via COMTEX) -- A senator leading an investigation into big investment banks' ties with now-bankrupt Enron Corp. has asked the heads of Citigroup Inc. and J.P. Morgan Chase & Co. to answer questions on their use of offshore companies in deals with Enron.

Sen. Carl Levin, D-Mich., sent letters Thursday to Citigroup chairman and chief executive officer Sanford Weill and J.P. Morgan Chase president and CEO William Harrison, setting a Monday deadline for them to personally provide the information.

Levin heads the investigative panel of the Senate Governmental Affairs Committee. At a hearing of the panel Tuesday, a committee investigator testified that the Wall Street investment banks, including Citigroup and J.P. Morgan Chase, gave Enron multimillion-dollar loans that helped the company disguise its true financial condition. In some cases, the investigator said, the banks knew Enron was using deceptive accounting for the loans.

Officials of Citigroup and J.P. Morgan Chase denied any wrongdoing in testimony at the hearing.

The letters to the bank executives from Levin, also signed by Sen. Susan Collins of Maine, the subcommittee's senior Republican, cited "troubling factual issues" that emerged at the hearing.

Spokesmen for the two financial companies couldn't be reached for comment Thursday night.

In a memo sent to Citigroup employees, Weill said Citigroup's transactions with Enron were legal, met accounting standards and reflected industry practices.

"And our people, relying on the advice of independent legal and accounting experts, believe they were doing the right thing," Weill said.

Harrison delivered a similar message to the investment community Wednesday, saying that the J.P. Morgan Chase acted "properly and with integrity" in all of its dealings with Enron, while also assuring investors that the bank itself was financially sound.

The bipartisan investigative subcommittee also found that some banks actively aided Enron in its deceptive accounting in return for big fees and favors in other deals.

Enron made a secret oral agreement in 1999 with Citigroup, the nation's largest financial institution, that disguised the company's improper accounting for a $125 million loan known as Roosevelt, according to committee investigators.

The banks used complex financial transactions to boost Enron's anemic cash flow to match its profit growth on paper, according to the investigators. Enron, an energy-trading company, recorded the money from the bank loans - said to total $8 billion - as prepaid trades of natural gas and other commodities with an entity based in the Channel Islands off Britain.

Copyright 2002 Associated Press, All rights reserved

[kattracks]

Notice there is no mention of Rubin and his connection to the clinton administration and Citigroup. You can be sure this wouldn't be the case if there was a Republican and/or President Bush connection.

[DarkWaters]

Of coarse, but this is only the beginning of trouble for Citygroup and JPM. The question who will get the blame still remains to be seen. Make no mistake the Rats will run and point fingers in any direction to get this off their backs.

[swheats]

There's a sense of satisfaction though concerning Rubin. Everybody that's anybody in the business world knows he's involved-the big smelly elephant in the room no one wants to deal with.

He has to be scared witless knowing every phone call or knock at the door could be his inquirers.

[Travis McGee]

PING!

[chnsmok]

Will never happen, but then I am the glass is half empty kind of person. I wish I knew the entity protecting the era of Bill and Hill. But, then again, maybe I do.

[wardaddy]

My guy in NYC told me tuesday that investigators were at Morgan at that point. Then Wednesday....Citi and Morgan and anyone who could lend a hand ..LOL...started buying up their stock and sort of sparked Wednesday's monster rally. I for one will gladly trade a stumble in a recovery for Rubin's head. I despise uber-wealthy snots expecting the rest of us to swallow their painless(for them) socialism and altruism even though our own means are tiny compared to them....and then to find out behind all that idealistic posturing, it's just another crook....makes my blood boil. Rubin was pretty tough in the private sector before he went to Treasury...he got accolades for that but he is not well liked contrary to media fawning. I am suprised Levin is willing to open this can of worms.

[Crazymonarch]

Of course whatevers left of Americas unlocked and rapidly emptying pension box probably guarantees these loans and their derivitives and gold market manipulation adventures.Al Greenspan the real slim shady.

[swheats]

Too many folk were/are willing to rollover for Bill/Hill to get a conviction. But there's a new sheriff in town. Stay tuned.

[Vidalia]

Sen. Carl Levin, D-Mich., sent letters Thursday to Citigroup chairman and chief executive officer Sanford Weill and J.P. Morgan Chase president and CEO William Harrison, setting a Monday deadline for them to personally provide the information.

This is as bogus as it get in D.C. He will be posturing for this to go nowhere.

Levin is a marsh mellowed toad and knows this will go nowhere.

Citi-Banc and associates, now Citi-Group merged for only one purpose and that was to cover the enormous influx of drug and various billions of illicit monies that they were laundering through various Blue-Chip companies through the stock market.

"Citi-boys" guaranteed the laundering partners that they would never lose, since they had the "illegal reserves" on hand...as opposed to the required percentage of CASH reserves required by the Federal Reserve Bank.

They knew that there would be no "run on the banks" a la the first Depression stock crash, for they always had the "spare" cash assets available, and were garnering more and more every day.

Only the Feds didn't know where all that cash was stashed, did they?.

Oh, a few hired Feds did, dutied and rogue, for they helped to keep the knowledge of the cash stash from their clean brethren, since many were rookies and had to be "looked over and checked out, as only the FBI could, " before being entered into the veteran's "Plenty of Cash for All of Us" Club.

So goddam many of the sitting Senators are as dirty for far many more years as may be found in the current hierarchy of private company Executive officers they are now so shallowly questioning.

More to come...Let's see, J.P. Morgan Chase & Co.? Hmmmmm.

How many Kafka-esque "metamorphosis" stages has the "Name here-Name here-Chase Bank gone through in the last 15 years of this Common Era?

These facts will only be postponed by the hearings, regardless of whether they come out before November or not, this sh*t will hit the Demos fan in due time.

You can bet your ass, it's time to get real mean, for the sake of the country...

[justshe]

The 'entity' might be a plain old cardboard box. Filled with over 900 files.

[Crazymonarch]

Damn bank wants me to make an appointment if I need more that 2k.All that money can be transfered electronically too if things get too hot,a threat Im sure they'll make if the probing gets rectal.

[Crazymonarch]

cardboard box has an 80 bodycount

[chnsmok]

I think it is more than 900. Suspicious nature.

[justshe]

I am suprised Levin is willing to open this can of worms.

Not hard to open the can when you have complete control of the can-opener. He is opening it ONLY so far...just far enough to make it look good. That is why we need to DELUGE our own Senators...and Levin and Lieberman as well, and DEMAND that Rubin be called to testify. And also demand that this be a FULL hearing...not a partial, don't ask the wrong questions, CYA hearing!

FREE CALL: Call the Capitol, toll free at 877-762-8762, then ask to be transfered to a Senator.

When I called, I was NOT asked my name, just where I lived. The point I made, after demanding that this hearing be MORE than just for show, was that the chair of ANY committee represents ALL of the people, and as such, they owe us a complete investigation.

[justshe]

A BIG box........

[justshe]

With Hillary..nothing is too vile to imagine. I doubt she has STOPPED collecting files. She's going to need them when the presidential run starts.

[Timesink]

Harrison delivered a similar message to the investment community Wednesday, saying that the J.P. Morgan Chase acted "properly and with integrity" in all of its dealings with Enron, while also assuring investors that the bank itself was financially sound.

Adelphia was "financially sound" too, until one of the Rigas guys suddenly blurted out during a conference call, "Oh, by the way, I took out a loan..."

That's what I don't understand about accounting. Adelphia is bankrupt now, but if Rigas had just kept his trap shut, the company could have kept plugging away for years! It's as if it's all just a big joke and the money doesn't even really exist. What am I missing? It is the resulting plummet in the stock price?

In any case, Mr. Harrison just uttered some "famous last words." Which is fine with me. Chase treated me like crap when I had accounts with them, just because I wasn't rich. Let 'em collapse.

[bescobar]

corrupt bankers? I am shocked that a banker could ever be a dirtbag money grubbing so and so. Jesus Christ came back and is tossing the money tables once again... "Get your cummupins here!!! Dirtbag money lenders gonna go to jail and get it in the rear!!!"

[Timesink]

bump for bump list

[goody2shooz]

Try Washington Mutual. You can find it online at www.wamu.com.
We do the preponderance of our banking with them. Nice folks. Good investment, too.