U.S. Senate Begins Investigating `Enron Gate`

The U.S. Senate began investigations into the circumstances surrounding the fall of Enron, the largest U.S. energy company, and questions around political lobbying. The first hearing is planned to begin on January 24.

The Senate Special Investigation Committee (Chairman Joseph Liberman) announced at a press conference on January 2 that it requested relevant documents from the board of directors in order to find out the facts surrounding Enron`s sudden bankruptcy and the weak government protection of investors.

Chairman Liberman indicated that investigations would not rule out even the relationship between George W. Bush administration and Enron, a sign that the case will create significant waves. He stated the intention to examine what influence Kenneth Ray, head of Enron, exercised on the Bush administration`s policy on energy in the beginning of last year.

The Wall Street Journal cited internal company documents and disclosed that top management of Enron was involved in building a lobby relationship with the political powerholders.

According to the Wall Street Journal, internal documents revealed that former company head Jeff Skilling and two other executives had to approve all lobbying transactions and that this was how Enron could omit 500 million dollars in debt and increase profit.

Once ranked seventh largest in revenue in America, Enron stocks cost 90 dollars per stock just one year ago but fell below 1 dollar last December, leaving investors with huge losses.

Ki-Heung Han eligius@donga.com