PracticeAuditUS judge allows class action against Enron

US judge allows class action against Enron

Some 30 US states seek billions of dollars from investment banks

A US federal judge in Houston has granted a case to proceed as a
class-action
suit
against investment banks for their role in Enron’s accounting fraud.

In court papers, which were filed in the federal appeals court on Monday, 30
states claimed that a number of investment banks are liable for their alleged
role in the accounting scandal that rocked the US in 2001.

Texas Attorney General, Greg Abbott and other legal counsel from
29
other states
, used legal arguments from the 2002 litigation brought by the
Securities and Exchange Commission to make a case that Merrill Lynch & Co.,
Credit Suisse and other investment banks should be held liable as partners in
the fraud.

The suit seeks billions of dollars in damage.

The SEC brought charges against Merrill, JPMorgan Chase
& Co. and Citigroup over the banks’ role in the Enron scheme and won tens of
millions of dollars in settlements in 2003.

Merrill Lynch & Co. have already asked their solicitors to file papers in
the Appeals Court opposing the court action.

Further reading:

Barclays escapes Enron censure

Former Enron CFO to turn on NatWest three

Natwest bankers arrive in US to face Enron
charges

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