Prosecutions of Enron staff highly unlikely, says ex-employee

A senior ex-Enron employee at the heart of the scandal that led to history's largest corporate bankruptcy told RiskNews' sister publication Energy & Power Risk Management that he expects no prosecution to be brought against Enron staff.

"There is simply not enough evidence left," he said, referring to the thousands of pages of records destroyed by the energy marketer's auditor, Andersen. "I really can't see any state or federal prosecutions being brought against Enron people. It's not going to happen, or it's highly unlikely at most," said the Houston-based executive, who has since moved to another finance company and wished to remain anonymous. But the source believes Andersen might have more trouble avoiding legal reprimand. "I would say that Andersen are the ones who are looking more guilty at the moment," he said.

As yet no Enron employees have been charged with any offence, despite a number of high-level investigations into alleged malpractice at the energy trading house.

The comments were made yesterday on the second day of testimony for David Duncan, a former Andersen accountant and head of the audit team assigned to Enron, in the US government’s case against Andersen.

Duncan told the court in Houston on Tuesday that it was "generally understood" at Andersen that Enron documents should be shredded after the federal investigation into the company had begun in October.

Duncan, the prosecution's star witness, pleaded guilty on April 9 to obstruction of justice and destroying Enron-related matter. He will be sentenced on August 26 and could receive a sentence of up to 10 years, although he hopes for less as he has co-operated with the prosecution's investigation.