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Key Questions About Enron

December 19, 2001

Key questions raised by House and Senate lawmakers investigating the collapse of Enron Corp., as framed Tuesday by Sen. Byron Dorgan, D-N.D., chairman of the Senate Commerce subcommittee on consumer affairs:

_Was Enron’s failure caused by bad luck, incompetence or greed? Were illegal or criminal actions involved?

_Where were the company’s directors while this was happening? How much did they profit from it? Were they kept in the dark by senior executives?

_What was the role of Enron’s longtime auditor, Arthur Andersen LLP? Were the accountants duped or were they incompetent? Wasn’t it a conflict of interest for the accounting firm to depend on Enron for tens of millions of dollars in consulting contracts, in addition to its auditing work?

_What about the federal regulatory agencies, such as the Securities and Exchange Commission? Did they miss signs of trouble at Enron?

_Did financial analysts who kept issuing ``strong buy″ recommendations for Enron stock know what they were doing? Did they have a conflict of interest because of their investment firms doing financial work for Enron?

A survey of analysts’ recommendations on Nov. 29, the day after Enron’s share price fell from around 60 cents to about 40 cents, found six ``strong buys″ for the stock, two ``buys,″ six ``holds,″ no ``sells″ and one ``strong sell.″

_Should a top Enron executive have been permitted to take an stake in the complex partnerships that allowed the company to keep some $500 million in debt off its books?

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