Lord Wakeham escapes probe over Enron role

No action is to be taken against Lord Wakeham for his role as a non executive
director and member of the audit committee at Enron when it collapsed.

But the
Disciplinary Scheme said
that there was a need to clarify the role of
non-execs and has written to the ICAEW and ICAS asking for guidance.

Chris Dickson, executive counsel of the JDS, this week announced his decision
to take no action against Lord Wakeham, a former Tory chief whip in Lady
Thatcher’s government, concluding that further investigations would not be

‘To investigate the matter further against Lord Wakeham would entail finding,
almost certainly in the US, evidence which has not been discovered by the
authorities there. The executive counsel considers that it is not practicable to
undertake such a search, and is conscious that he has no power to compel any
witness in the US to co-operate with him. He does not believe, therefore, that
it is in the public interest for him to enquire further into the matter,’ the
statement said.

Following the 2001 collapse of Enron, its directors have been extensively
investigated in the US resulting in CFO Andrew Fastow, being sentenced to six
years imprisonment and a $24m (£11.9m) fine, while the auditors, Andersen, were
fined $500,000 and given a five-year probation sentence. though the conviction
was quashed.

But the US authorities did not see fit to take action against non-executive
directors such as Lord Wakeham.

The JDS began inquiries into Lord Wakeham on the basis of the key role he
played as he was the only professional accountant on Enron’s audit committee.
‘It does not appear that Lord Wakeham had a sufficient understanding of these
transactions,’ the JDS said.

Further Reading:

the JDS’s report on the matter

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