Lab Report File
Enron is an energy company based in Houston, Texas that deals with the energy trade on an international and domestic basis. It was formed in 1985 when Houston Natural Gas merged with InterNorth. After several years of international and domestic expansion involving complicated deals and contracts, Enron was billions of dollars into debt. All of this debt was concealed from shareholders through partnerships with other companies, fraudulent accounting, and illegal loans. Listed below are a few of the partnerships that allowed Enron to hide debt: RADR, Chewco, and Southampton.
February 20, 2001 - Stock Close: $75.09
December 2 - Stock Close: 26 cents
Great articles in Time magazine of the timeline and who certain executives talked to throughout this scandal. The Vice President and the Treasurer. Attorney General John Ashcroft has to exclude himself from the investigation because of contributions he received from Enron.
Arthur Andersen acknowledges destroying Enron files. All these years of manipulation on the part of the higher ups and then they blame it on accounting errors.
California's deregulation and subsequent energy crisis
Enron traders were revealed as intentionally encouraging the removal of power from the market during California's energy crisis by encouraging suppliers to shut down plants to perform unnecessary maintenance, as documented in recordings made at the time. These acts contributed to the need for rolling blackouts, which adversely affected many businesses dependent upon a reliable supply of electricity, and inconvenienced a large number of retail consumers. This scattered supply increased the price exponentially, and Enron traders were thus able to sell power at premium prices, sometimes up to a factor of 20x its normal peak...