California Senate committee votes to pursue criminal charges against Enron

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Posted 7:54AM on Wednesday, February 13, 2002

SACRAMENTO, Calif. - A California Senate committee, convinced that bankrupt energy trader Enron Corp. has destroyed financial documents under legislative subpoena, voted to seek criminal charges against the company for concealing evidence and conspiracy. Committee members also voted Tuesday to ask the full state Senate to find Enron in contempt of two legislative subpoenas -- one issued in June seeking documents related to California's energy market and the other for testimony about destruction of documents. The committee voted 5-0 to ask the district attorney from either Sacramento or Orange County to investigate whether Enron intentionally withheld documents from investigators or destroyed any relevant papers. Lawmakers investigating California's power crisis asked Enron for thousands of documents in June, but the company's destruction of documents and shredding done by its accountants may have violated that order, said Sen. Joe Dunn, a Democrat from Santa Ana. Last month, Enron officials ignored a committee request to testify about which documents may have been destroyed. Enron officials didn't attend Tuesday's hearing of the Senate Select Committee to Investigate Price Manipulation in the Wholesale Energy Market. Calls for comment were not immediately returned. Last week, Enron Vice President Richard B. Sanders wrote Dunn to say there was no reason for company officials to testify because Enron wasn't "aware of anyone from Enron who made inquiries to Arthur Andersen regarding what documents were destroyed." Andersen was the major accounting firm that audited Enron's books. Andersen officials have said their accountants shredded some Enron-related documents. Larry Drivon, an attorney for the committee, recommended that prosecutors also investigate whether company employees conspired to withhold or destroy documents, which would elevate the crime from a misdemeanor to a felony. Enron has invited investigators to search the company's document repositories in Portland, Ore. and Houston, Texas, for trading and policy documents they subpoenaed last year, Dunn said. The committee also is preparing subpoenas for testimony from Andersen regarding destruction of some Enron documents. The committee has subpoenaed documents from a half-dozen energy companies as part of the investigation into the state's power crisis last year, when energy prices soared.