Skilling Involved, Enron Execs Say

Former Enron Corp. Chief Executive Jeffrey K. Skilling oversaw the reorganization of partnerships that figured in the energy trader’s bankruptcy, company officers told an internal review team.

Richard A. Causey, the former chief accounting officer, and other executives told members of Enron’s board of directors that they kept Skilling briefed on their efforts to salvage the finances of the four so-called Raptor partnerships.

The interviews, which were released by the House Energy and Commerce Committee, flesh out the conclusions of the board’s Feb.2 report that said Skilling bore some responsibility for Enron’s filing the largest bankruptcy in history two months earlier.

In two appearances before Congress, Skilling, who resigned as CEO Aug. 14 after six months in the job, has said he relied on the advice of Causey and auditors from Andersen in managing the partnerships.

“My only recollection of the restructuring of the Raptors is that I was told they were restructuring the Raptors,” he told the Senate Commerce Committee on Tuesday.

“I asked if the accountants signed off and if it looked OK, and I was told it was and went along with it,” Skilling said.

Also Thursday, documents disclosed that the government’s top energy regulator met with senior Enron executives last fall and received a phone call from Enron’s chairman, continuing a series of contacts that began when he was head of Texas’ public utility commission.

Patrick H. Wood III, appointed by President Bush to head the Federal Energy Regulatory Commission in August, told a lawmaker Thursday that he first met then-Enron Chairman Kenneth L. Lay in May 1996 at a meeting of the Governor’s Business Council in Texas.

Between March 1997 and January 2001, Wood said, he had contacts with Lay, Skilling and Enron Chief of Staff Steve Kean, who visited Wood’s office at the utility commission in January 1998, according to documents released Thursday at the request of Rep. Henry A. Waxman (D-Los Angeles).

In all, Wood listed nine contacts with Enron executives. He also listed a failed Nov. 8 attempt by Lay to reach him, which appeared to have been a call to inform Wood of the proposed merger with Dynegy Inc.

Also Thursday, congressional Democrats proposed legislation to forbid accounting firms from providing consulting services for audit clients, make them keep records longer and increase their liability in shareholder suits.

Legislation sponsored by Rep. John J. LaFalce (D-N.Y.) also would establish a new accounting industry oversight board. The measure is more extensive, he said, than a competing proposal by House Republicans.

“We have an opportunity to adopt serious reforms to correct the weaknesses that are undermining confidence in our capital markets,” LaFalce, the senior Democrat on the House Financial Services Committee, said.

The Republican and Democratic proposals come as Congress investigates the bankruptcy of Enron and the role of Andersen, its former auditor, in reviewing affiliated partnerships that played a role in the company’s collapse.

Congressional investigators said they are close to a deal with Enron to allow public disclosure of the energy trader’s tax records.

The deal, expected before week’s end, would clear the way for the Senate Finance Committee to step up its investigation of whether Enron improperly avoided paying federal income taxes or exploited tax loopholes that may need to be closed.

Associated Press, Bloomberg News and Reuters were used in compiling this report.