June 17, 2002	Monday	Rabi-us-Sani 5, 1423

HOUSTON, June 16: The former Big Five accounting firm Arthur Andersen LLP was convicted of obstructing justice on Saturday for destroying tons of documents related to its former client, Enron Corporation.

A federal jury concluded after 72 hours of deliberations spread over 10 days that Andersen staffers conspired to destroy or erase Enron-related documents as the Houston energy trader headed towards a meltdown in late 2001 in the full spotlight of an official investigation.

“Arthur Andersen was a lapdog, not a watchdog,” prosecutor Andrew Weissmann said, referring to Andersen’s botched audits of Enron and the cozy relationship between Andersen auditors and Enron executives.

The audit firm, which argued that the document destruction was not a cover-up but a case of routine housekeeping, immediately said it would appeal the verdict.

“Today’s verdict is wrong,” said Andersen spokesman Patrick Dorton. “Arthur Andersen is planning to appeal the conviction based on flawed jury instructions and erroneous rulings that precluded Andersen from presenting its entire defence.”

But the US Department of Justice was clearly elated by the outcome of the six-week trial.

Deputy Attorney General Larry Thompson said in a statement that he was “extremely gratified” by the verdict.

“This verdict confirms that Andersen knew full well that these documents were relevant to the inquiries into Enron’s collapse and that Andersen partners and employees personally directed these efforts to destroy evidence,” the statement read.

The presiding judge, Melinda Harmon, is expected to hand down a sentence on October 11, according to defence attorneys.

That will probably involve a five-year probation period and a fine of 500,000 dollars.

In addition, a criminal conviction will automatically disqualify the 89-year-old Chicago-based firm from auditing any publicly traded companies under US Securities and Exchange Commission (SEC) rules.—AFP