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Feinstein, Cantwell Link Enron to Surging Gas Prices

by The Hill - 05/02/06 3:49 PM ET

Sens. Diane Feinstein (D-Calif.) and Maria Cantwell (D-Wash.) submitted a Freedom of Information Act (FOIA) request to the Department of Justice for evidence acquired during its investigation of the energy company, Enron. Feinstein discussed the possible link between Enron’s activities and surging gas prices.

As an example, according to media reports, one of the Enron traders who booked $750 million in natural gas contracts in 2001, subsequently started Centaurus Energy, a hedge fund company that trades energy commodities. When he was asked during a deposition about whether he had ever manipulated the Western energy markets while at Enron, he took the 5th Amendment and refused to answer. This man was never prosecuted, and is now trading energy commodities that are not subject to federal oversight.

American consumers need to be assured that the dramatic escalation in oil prices is not once again the result of energy market manipulation. And we need to know why those who may have manipulated the marketplace have not been subject to further scrutiny.”

Cantwell added

The American people have a right to know the full extent of Enron’s schemes to exploit consumers and steal millions from Western ratepayers. Keeping hundreds of hours of audiotape locked away will make it more difficult to prevent this kind of massive rip-off in the future.

Businesses and utilities still trying to prove their cases against Enron need this evidence to ensure justice. Policy makers need it to make sure we close every loophole that lets energy traders pick the pockets of American consumers. Using the same loopholes that helped them manipulate Western energy markets five years ago, former Enron traders are making millions each year in energy markets now.

We need access to the Enron evidence and better transparency to understand the complex speculation market dynamics; and federal regulators need more tools to protect consumers so they can trust that the prices they are paying are legitimate and not artificially inflated.