Criminal investigation takes centre stage in Enron affair

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The Independent US

The abrupt refusal of Kenneth Lay, Enron's former chairman, to testify before Congress may set a pattern for other company executives due to follow him this week, as the criminal ramifications of the collapse of the giant energy corporation increasingly take centre stage.

The latest developments in the case, including a devastating internal report released by the Enron board at the weekend and the remark of one congressman that some people involved should go to jail, all underline one thing: that the affair will play out not in committee rooms on Capitol Hill, or even in revelations of new political ties between Enron and the Bush administration, but through the Justice Department's criminal investigation into the case.

Yesterday disappointed members of the Senate Commerce Committee were weighing whether to issue a sub-poena to force Mr Lay to appear – but in that case he would almost certainly invoke his constitutional right against self-incrimination under the Fifth Amendment, and remain silent on key questions.

Already Andrew Fastow, Enron's former chief financial officer, has indicated he will "take the fifth" if he appears as scheduled before a House committee on Thursday. So too has Michael Kopper, who headed "Chewco", one of the secret partnerships that hid Enron debt and brought the company to disaster.

That leaves Jeffrey Skilling, Enron's chief executive officer until he resigned late last year, as the most senior figure who remains prepared to testify.

Another potential witness on Thursday is Robert Jaedicke, chairman of Enron's audit committee, on which Lord Wakeham, the former Conservative cabinet minister, also served.

Mr Lay's sudden reversal of his willingness to testify yesterday seems to have been brought about by the internal report, which asserts that Enron's earnings were artificially inflated and that several executives made vast sums of money in the process. One former prosecutor and accountant described the 213-page report as "a road map for the Justice Department to bring a criminal indictment", while Senator Jon Korzine of New Jersey said it presented "a pretty straightforward case of fraud".

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