- Copyright 2002, From The Wilderness Publications and
Michael C. Ruppert, www.copvcia.com. All rights reserved. May be reprinted,
copied, distributed or posted on the internet for non-profit purposes only.
- (FTW) - In the exploding popcorn mix of new Enron investigations,
increasingly focusing on possible criminal misconduct by accounting giant
Arthur Andersen, a Justice Department spokesperson has told FTW that a
contract for Andersen to review sensitive FBI management and recordkeeping
procedures has been unaffected.
- Recent statements by Senators Joseph Lieberman (D-CT)
and Russ Feingold (D-WI) indicating that investigations of Andersen may
turn criminal, and a January 14 commentary by CNN's Lou Dobbs indicating
that the scandal may put the company out of business, raise serious questions
about the Department of Justice's contract calling for Andersen to "review
the FBI's management practices, including recordkeeping, technology and
human resources issues," as described in an August 29, 2001 story
by reporter Kellie Lunney on the website www.GovExec.com. This is especially
relevant since FBI agents will themselves be investigating Andersen in
newly announced DoJ probes related to Enron.
- The Gov Exec story, relying on documents from the Federal
Register, detailed that, "In July, Justice and FBI officials revealed
that more than 400 weapons and 180 laptop computers - including some holding
sensitive and classified information - were missing from the agency. The
FBI has faced harsh criticism over the last few months, most notably for
its failure to turn over all documents to lawyers for Oklahoma City bomber
Timothy McVeigh, a controversy that resulted in a temporary postponement
of McVeigh's execution."
- In August, Attorney General John Ashcroft authorized
the creation of a special commission to evaluate years of serious and well-documented
FBI lapses ranging from mishandling of key evidence in the crime lab, as
exposed by FBI whistleblower Fred Whitehurst, to the loss of sensitive
intelligence materials. Commission members include former CIA Director
William Webster, former Secretary of Defense William Cohen, former House
Speaker Tom Foley and former HUD Secretary and U.S. Trade Rep Carla Hills.
- According to the GovExec story, "All of the commission's
meetings will be closed to the public to protect sensitive information
according to a July 16 memo from the Justice Department." The key
question is, "Information sensitive to whom, that might damage whose
- DoJ spokesman Brian Sierra indicated on January 14, that
the issue of Andersen's contract, which would give them access to many
of the FBI's most sensitive files, has not yet been raised in the wake
of the rapidly evolving Enron debacle. "As of this moment the contract
is still in effect," said Sierra. I can't speak to the issue and I
don't think the question has been brought up at Justice."
- Spokespersons for Andersen, headquartered in Chicago,
did not return an FTW call asking for comment.
- The obvious conflict of interest could not come at a
worse time for an Administration that is frantically attempting to get
ahead of the Enron scandal. It also comes at a time when the impartiality
of other government agencies including the Securities and Exchange Commission
and the General Accounting office is called into question because of the
past relationships of the heads of those two agencies with the embattled
accounting firm. Harvey Pitt at SEC once represented Andersen in his private
law practice. GAO chief David Walker is a former board member at Andersen
whose tenure there ended in late 1998, long after the time period in which
Andersen has been implicated in the falsifications of Enron's financial
statements which began in 1997.
- Walker's former partners may now become the subject of
criminal probes by the FBI, the SEC and the GAO. Unlike the SEC and the
FBI, the GAO is known as the investigative arm of Congress - the same Congress
which is now representing itself to be the champion of the public interest.
Headed by Walker in the Comptroller General position, the GAO remains one
of the last defensible positions that the government - both the White House
and the Congress - can offer as a statement of government credibility to
an increasingly cynical population.
- The notion that Andersen could now be trusted to investigate
the FBI and gain access to information that would damage the FBI's credibility
and possibly be traded off for softer handling for its own actions stretches
the imagination to the breaking point and beyond. Congress and the administration
need to understand that by failing to walk the most perfect of lines with
Enron and Andersen they risk the credibility of the entire government and
not just the Bush White House.
- A previous FTW story on unexplored conflicts of interest
related to Enron is located at: http://www.copvcia.com/members/enron_money_laundering.html.