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Bankruptcy examiner says Enron shifted assets to make profits
Houston, Mar 06: Executives of failed energy merchant Enron Corp. shifted billions of dollars in assets off its balance sheet so it could report huge profits and make its debt look lower than it was with the help of willing lawyers, banks and auditors, according to a bankruptcy examiner.
Houston, Mar 06: Executives of failed energy merchant Enron Corp. shifted billions of dollars in assets off its balance sheet so it could report huge profits and make its debt look lower than it was with the help of willing lawyers, banks and auditors, according to a bankruptcy examiner.
Neil Batson, in a lengthy report yesterday to the court overseeing what was once the largest corporate bankruptcy in US history, said that Enron repeatedly broke Securities and Exchange Commission rules and materially misrepresented its financial condition.
In a 2,000-plus page report, Batson described how Enron used special purpose entities and various accounting techniques to conceal its poor performance.
The report said that because many transactions were improper and possibly illegal, as much as USD 5 billion in cash and assets could be recovered by the bankrupt company and its unsecured creditors, according to published reports. Batson, who is responsible for recovering assets for Enron creditors, suggested in the report that Enron could reclaim between USD 1.7 billion and USD 2.1 billion in assets that it moved off its balance sheets to enable those special deals, according to Dow Jones Newswires. The report says Enron could also recover an additional USD 2.9 billion in assets that were fraudulently moved out of the company shortly before its bankruptcy filing.
Bureau Report
Neil Batson, in a lengthy report yesterday to the court overseeing what was once the largest corporate bankruptcy in US history, said that Enron repeatedly broke Securities and Exchange Commission rules and materially misrepresented its financial condition.
In a 2,000-plus page report, Batson described how Enron used special purpose entities and various accounting techniques to conceal its poor performance.
The report said that because many transactions were improper and possibly illegal, as much as USD 5 billion in cash and assets could be recovered by the bankrupt company and its unsecured creditors, according to published reports. Batson, who is responsible for recovering assets for Enron creditors, suggested in the report that Enron could reclaim between USD 1.7 billion and USD 2.1 billion in assets that it moved off its balance sheets to enable those special deals, according to Dow Jones Newswires. The report says Enron could also recover an additional USD 2.9 billion in assets that were fraudulently moved out of the company shortly before its bankruptcy filing.
Bureau Report