The Role Of The Financial Institutions In Enron S Collapse

Witnesses: Robert Roach, Permanent Subcomm. on Invest., accomp. by Gary Brown, Comm. on Gov'l. Affairs; Lynn. Turner, SEC; Pamela Stumpp, Corp. Finance Group, & John Diaz, Power & Energy Group, Moody's Invest. Serv.; Ronald Barone, Utilities, Energy & Project Fin. Group, Corporate & Govt. Ratings, & Nik Khakee, Standard & Poor's; Jeffrey Dellapina, JPMorgan Chase Bank; Donald McCree, J.P. Morgan Sec., Inc.; Robert Traband, JPMorgan Chase Bank; David Bushnell, Global Risk Mgmt.; Richard Caplan, Credit Deriv. Group, Maureen Hendricks, Sr. Advisory Dir., & James Reilly Jr., Global Power & Energy Group, Salomon Smith Barney/Citigroup; Robert Furst, Schuyler Tilnery, & G. Kelly Martin, Sr., Merrill Lynch.

In the wake of a series of recent corporate scandals and bankruptcies, the Sarbanes-Oxley Act mandated that the GAO study the involvement of investment banks (IB) with two companies, Enron and Global Crossing. In this report, the term "IB" includes not only securities firms but also those bank holding companies. with securities affiliates or business divisions that assist clients in obtaining funds to finance investment projects. GAO agreed to provide publicly available information on the roles IB played in designing, executing, and participating in certain structured finance transactions, IB, and Federal regulators' oversight of these transactions, and the role that the IBs' research analysts played with Enron and Global Crossing. Charts and tables.

Witnesses: Robert Roach, Perm. Subcomm. on Invest., accomp. by Gary Brown, Comm. on Gov'l. Aff.; Lynn Turner, SEC; Pamela Stumpp, Corp. Fin. Group, & John Diaz, Power & Energy Group, Moody's Invest. Service; Ronald Barone, Util., Energy & Project Fin. Group, & Nik Khakee, Structured Fin. Group, Standard & Poor's; Jeffrey Dellapina, JPMorgan Chase Bank; Don McCree, J.P. Morgan Securities; Robert Traband, JPMorgan Chase Bank; David Bushnell, Global Risk Mgmt., Richard Caplan, Credit Deriv. Group, Maureen Hendricks, & James Reilly Jr., Global Power & Energy Group, Salomon Smith Barney/Citigroup; Robert Furst, Merrill Lynch; Schuyler Tilnery, Global Markets & Invest. Bank., & G. Kelly Martin, Internat. Private Client Div., Merrill Lynch.

Preface; Enron: A Select Chronology of Congressional, Corporate, and Government Activities; Enron and Stock Analyst Objectivity; Soft Money, Allegations of Political Corruption, and Enron; Enron: Selected Securities, Accounting, and Pension Laws Possibly Implicated in Its Collapse; The Enron Collapse: An Overview of Financial Issues; Auditing and Its Regulators: Proposals for Reform after Enron; Enron's Banking Relationships and Congressional Repeal of Statutes Separating Bank Lending from Investment Banking; Enron Bankruptcy: Issues for Financial Oversight; The Enron Bankruptcy and Employer Stock in Retirement Plans; Enron and Taxes; Title vs Enron Corp. and Fiduciary Duties Under ERISA; Possible Criminal Provisions Which May Be Implicated in the Events Surrounding the Collapse of the Enron Corporation; Index.