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Enron Admits Error in Lobbying Costs
By:
The Associated Press
Washington -- Enron Corp. apparently failed to disclose many of its lobbying expenses to Congress last year as the energy trader headed toward financial disaster. Enron acknowledged the problem Tuesday night after a private group that tracks money in politics compared Enron's lobbying filing to Congress in August with congressional filings by outside lobbying firms. The lobbying firms say they were paid more than $1.6 million by Enron for the first six months of 2001. Enron reported spending $825,000. Enron spokeswoman Karen Denne said the company's spending figure submitted to Congress last Aug. 15 is meant to cover lobbying by the company's own staff and work by outside lobbying firms. ``We are reviewing those fees and will respond in writing to the secretary of the Senate,'' Denne said. As law enforcement agencies and congressional committees pressed their investigations into Enron's collapse, the General Accounting Office was announcing it will sue the White House for access to documents from Vice President Dick Cheney's energy task force, a congressional source told The Associated Press. GAO is an investigative arm of Congress. Thousands of employees and big and small investors nationwide lost fortunes in Enron's plunging stock as the company slid into the biggest bankruptcy in U.S. history on Dec. 2. The company's stunning collapse prompted President Bush, in his State of the Union address Tuesday night, to call on Congress to reform pension laws and require more financial disclosure by corporations. Bush did not mention Houston-based Enron by name. Its former chairman, Kenneth Lay, was one of Bush's biggest political supporters. ``A good job should lead to security in retirement. I ask Congress to enact new safeguards for 401(k) and pension plans,'' Bush said. ``Employees who have worked hard and saved all their lives should not have to risk losing everything if their company fails. Through stricter accounting standards and tougher disclosure requirements, corporate America must be made more accountable to employees and shareholders and held to the highest standards of conduct.'' Among the lobbyists doing work for Enron were Republican strategist Ed Gillespie; ex-Sen. J. Bennett Johnston, a Louisiana Democratic; and current Republican Party chief Marc Racicot; and two ex-aides to House Majority Whip Tom DeLay. Racicot still collects a salary from his firm but said when he took the GOP post he would no longer lobby for Enron. In the face of mounting criticism, Racicot has since given up his other lobbying clients as well. The discrepancy in Enron's lobbying expenses was discovered by the Washington-based Center for Responsive Politics. Its executive director, Larry Noble, said ``it is particularly critical at this time for the public to have the full picture of Enron's lobbying activities.'' Also on Tuesday, Enron's political action committee said it donated at least $26,000 to congressional campaigns in November, the month before the company filed for bankruptcy protection. Recipients included several lawmakers on the committees now investigating Enron's collapse. At least two, Rep. Mary Bono, R-Calif., and Rep. Greg Walden, R-Ore., plan to give their donations to charity. The Enron PAC donated at least $120,188 to federal candidates and fund-raising committees last year, the report shows. In another development, the issue of document-shredding re-emerged at Enron, with the company saying it hired private companies to destroy documents as recently as mid-January. Robert Bennett, an attorney representing the company, said the discarded documents were not sensitive financial records, and any suggestion of any impropriety was ``a bunch of nonsense.'' Enron hired two companies, one of them named Shredco, to destroy a huge volume of material, ABC News reported Tuesday night. ``There was a contract with a company when Enron consolidated down from two buildings to one building,'' Bennett said. ``There was a lot of information including payroll records, resumes, Social Security numbers. These trucks came in in the light of day.'' ``Even if they're shredding old newspapers, they need to contact the Justice Department'' to get permission to do so and allay suspicions, said Rep. Jim Greenwood, R-Pa., who chairs the House Energy and Commerce oversight and investigations subcommittee looking into Enron. FBI agents have been investigating allegations of
massive shredding of documents at Enron's Houston headquarters. The
company's auditor, Arthur Andersen LLP, has acknowledged destroying
Enron-related documents and e-mails that were sought by federal and
congressional investigators. Enron confesses having failed to reveal some of the lobbying expenses to Congress last year as it headed for bankruptcy. Enron’s spokes woman said ``We are reviewing those fees and will respond in writing to the secretary of the Senate''. FAIR USE NOTICE: This page contains copyrighted material the use of which has not been specifically authorized by the copyright owner. Global Action on Aging distributes this material without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. We believe this constitutes a fair use of any such copyrighted material as provided for in 17 U.S.C § 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond fair use, you must obtain permission from the copyright owner.
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