February 4, 2002	Monday	Ziqa’ad 20, 1422

WASHINGTON, Feb 3: Enron’s former top executives, set to testify in Congress, were skewered in a report to the fallen energy giant’s board, blamed for shady accounting that overstated earnings by nearly one billion dollars.

The “massive problems” summarized in the 218-page report suggest “a culture of corporate corruption... and put people in real jeopardy,” said N. Dakota Democrat Byron Dorgan, whose Senate Commerce subcommittee opens hearings on Monday.

“In the last year ...one billion dollars in profits was booked here that really did not exist. That’s big trouble.”

According to the report, “The tragic consequences of the related-party transactions and accounting errors were the result of failures at many levels and by many people: a flawed idea, self-enrichment by employees... inattentive oversight... and overreaching in a culture that appears to have encouraged pushing the limits.”

Once the seventh-biggest company in the US, the energy trader suffered a spectacular collapse in late 2001 and filed for bankruptcy on Dec 2.

Thousands of employees whose life savings were vested in company stock saw their shares fall from a one-time high of more than 80 dollars apiece to worth less than the paper they were printed on.

According to the report, former CEO Kenneth Lay bears “the ultimate responsibility” for the collapse.

The report said a series of investment partnerships created and managed by former chief financial officer and executive vice president Andrew Fastow, “were designed to accomplish favourable financial statement results, not to achieve bona fide economic objectives.”

Fastow pulled in “at least” 30 million dollars from the questionable transactions — the largest chunk of the “tens of millions of dollars” earned by Enron employees involved in the partnerships.—AFP