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Response to Enron

ADA National Board Meeting
Methodist Building
Washington, DC
January 11-13, 2002

Whereas the Enron Corporation has been a major proponent of electricity deregulation and one of the companies whose trading activities led to the California energy crisis which cost consumers and the state billions of dollars,

Whereas, the Enron Corporation and its executives have been major contributors to the Republican party, the Democratic Party, and to the campaigns of George W. Bush,

Whereas the Enron Corporation was given a major role in the incoming Bush Administration's National Energy Policy Development Group,

Whereas the General Accounting Office attempted to get information from the Administration on the workings of the National Energy Policy group and was rebuffed,

Whereas, the policy group report endorsed many of the Enron proposals,

Whereas, Enron had set up more than 500 offshore partnerships to conceal its trading activities and its exposure to loss, and these offshore trading activities enabled the corporation to conceal the trading risks it was taking from shareholders and regulators,

Whereas the risky trading led to the financial collapse of the company, the destruction of employee pension plans, the destruction of shareholder value and as yet unquantifiable consumer losses,

Americans for Democratic Action urges immediate, full and detailed disclosure of all the contacts the company has had with federal, state and local governments since January 20, 2001,

A complete investigation of Enron's activities by the Securities and Exchange Commission, and a Department of Justice insulated from political interference,

A similar investigation of the Enron accounting firm, Arthur Andersen,

Where appropriate, the prompt prosecution of the individuals responsible,

Where appropriate, civil actions to require executives to disgorge the profits they made at the expense of the employees and shareholders,

The re-regulation of energy-producing companies to avoid devastating problems such as those demonstrated by the recent energy crisis in California and the collapse of Enron, and

A revision of the law and the accounting rules which make it possible for a public company to hide its activities in offshore corporations and partnerships.

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