Report: L.A. Suburb May Have Helped Enron

LOS ANGELES -- Newly released federal documents suggest that the Los Angeles suburb of Glendale helped Enron Corp. traders manipulate California's energy market during the state's 2000-2001 power crisis to drive up prices, The Los Angeles Times reported Saturday.

The Federal Energy Regulatory Commission documents show municipal utility managers even quizzed employees on a Fat Boy strategy -- the nickname Enron gave a trading scheme to create the appearance of power shortages, the paper reported. Several wrote on a February 2000 test that it involved splitting profits or losses with Enron.

Glendale city officials have said that they agreed to share profits with Enron from the sale of surplus electricity produced by the city's power plant but that an investigation found no wrongdoing.

State and federal officials have not provided estimates of Glendale's profits from its partnership with Enron; however, Glendale City Manager James Starbird said he would put the number at $3.9 million.

-- NYSSCPA.org News Staff

Posted on 03/31/03