US Senate slams SEC over Enron
Chief financial watchdog, the Securities & Exchange Commission has come in for severe criticism over its handling of Enron prior to the energy giant's collapse.
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In a damning report, a US Senate investigation said serious failings at the SEC had led to the collapse of the once-mighty energy company.
Enron filed for Chapter 11-bankruptcy protection in December 2001, after once being worth £62bn.
In the 127-page report, the Senate said the watchdog had not reviewed any of Enron’s financial statements since 1998, which it claimed would have ‘uncovered some of the problems with the company’s financial practices that appear to have been signalled in these documents’.
Furthermore, the SEC had exempted Enron from some federal accounting requirements.
The report, released in full today also found fault with Wall Street financial analysts, investment banks, credit rating agencies and auditors who, it said, did not detect the accounting irregularities or recommend tighter controls.
The SEC has not yet responded to the report.