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CNN Live At Daybreak

Eight Enron Investigations Ongoing

Aired January 17, 2002 - 06:31   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: On Capitol Hill there are eight separate investigations into the Enron case. Some of the questions deal with Enron's political connection.

CNN's Jeff Levine brings us the latest on the nation's biggest bankruptcy.

(BEGIN VIDEOTAPE)

JEFF LEVINE, CNN CORRESPONDENT: David Duncan until Tuesday, head of Arthur Andersen's Houston office, paid a visit to Washington for a chat with congressional watchdogs. At issue, allegations that he shredded documents when he was auditing Enron before it became the biggest bankruptcy in U.S. history.

Meanwhile, White House spokesman Ari Fleischer defied reporters to come up with evidence that members of the president's team had bent the rules for Enron and its politically powerful executives.

ARI FLEISCHER, WHITE HOUSE SPOKESMAN: If you have any information, any evidence you would like to bring forth, about potential wrongdoing, we will do our best to track it down for you. But other than that, I'd liken it to a fishing expedition.

LEVINE: Senator Ted Kennedy is leading one of eight investigations into Enron on Capitol Hill. He wants to know why workers weren't able to sell their Enron stock in the company's retirement plan while Enron was going broke. The energy trading giant listed assets of $49 billion at the time it sought protection from the court last December.

SEN. EDWARD KENNEDY, (D), MASSACHUSETTS: We must protect the pensions and retirement savings of all workers from the threats of future Enrons. We can not allow corporate executives to cash in and take home millions while their workers' retirement savings disappear.

LEVINE: Perhaps the biggest question is whether Enron's well- connected CEO, Kenneth Lay, got special treatment from the Bush administration. Enron executives and its political action committee, according to the Center for Responsive Politics, gave $5.8 million in campaign contributions since 1989 mostly to Republicans.

More than $200,000 went to the Bush presidential campaign. A key question for the government, did Enron break the law or just go broke? But even Attorney General John Ashcroft has had to recuse himself from the criminal probe of Enron because he took contributions from the company during his last race for the U.S. Senate. As Enron's losses mounted to more than $600 million last October, the Securities and Exchange Commission started an investigation.

Duncan was ultimately fired, but he says he did nothing wrong. For its part, Andersen issued an apology - quote - "the firm discovered activities including the deletion of thousands of e-mails and the rush disposal of large numbers of paper documents. These activities were on such a scale and of such a nature, as to remove any doubt that Andersen's policies and reasonable good judgment were violated".

Lawyers for Enron dispute the notion that company executives profited mightily while their employees suffered. Few are using the word scandal to describe Enron's spectacular failure yet, but the whole story with its political implications has yet to be told.

Jeff Levine for CNN, Washington.

(END VIDEOTAPE)

COSTELLO: Just keeps getting more interested, doesn't it?

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