FBI Probe Linked to Enron Collapse?
October 9, 2003 — Our Action News investigation reveals that the FBI corruption probe reaches into almost every corner of city government. The main focus appears to be the awarding of contracts and lucrative legal work on city issued bonds, and that some of the probe may have been triggered by the Enron scandal.
Action News has learned that when the Enron scandal broke, red flags were raised at the City Controller's office. That's because the company that had won the controversial airport maintenance contract is an Enron subsidiary. Affiliated Business Services, based in Houston, teamed up with two politically connected Philadelphia companies when it bid on the contract.
One of the companies, General Asphalt, hired Mayor Street's brother Milton. They say he was there to help mediate the bidding process. The other company, U.S. Facilities, has close ties with former City controller Tom Leonard.
Former Enron subsidiary eventually won the contract with a low bid of $13.6 million dollars. A year later, Affiliated Business Services bought out General Asphalt's and U.S. Facilities shares of the contract.
Both companies say Milton Street's involvement did nothing to open doors for them, and they say they have not been contacted by the FBI. We've also learned that in addition to the city, federal investigators are looking into airport contracts too. The FBI is also looking into the awarding of city bond work. When the city needs money for major building projects, it issues bonds. That requires legal work, which is usually a percentage of the bond.
The federal investigation has tentacles spread into the far corners of the city's contracting practices. What they eventually snare if anything, remains to be seen.
(Copyright 2003 by Action News. All Rights Reserved.)
LOLOLOL!!!!