[news] Enron Traders Caught On Tape

Thu Jun 3 05:58:17 PDT 2004

> from CBS News
> http://www.cbsnews.com/stories/2004/06/01/eveningnews/main620626.shtml
>  -------------------------------------------------
>
>  Enron Traders Caught On Tape
>
>  June 1, 2004
>
>  (CBS News)  When a forest fire shut down a major transmission line
>  into California, cutting power supplies and raising prices, Enron
>  energy traders celebrated, CBS News Correspondent Vince Gonzales
>  reports.
>
>  "Burn, baby, burn. That's a beautiful thing," a trader sang about the
>  massive fire.
>
>  Four years after California's disastrous experiment with energy
>  deregulation, Enron energy traders can be heard - on audiotapes
>  obtained by CBS News - gloating and praising each other as they
>  helped bring on, and cash-in on, the Western power crisis.
>
>  "He just f---s California," says one Enron employee. "He steals money
>  from California to the tune of about a million."
>
>  "Will you rephrase that?" asks a second employee.
>
>  "OK, he, um, he arbitrages the California market to the tune of a
>  million bucks or two a day," replies the first.
>
>  The tapes, from Enron's West Coast trading desk, also confirm what
>  CBS reported years ago: that in secret deals with power producers,
>  traders deliberately drove up prices by ordering power plants shut
>  down.
>
>  "If you took down the steamer, how long would it take to get it back
>  up?" an Enron worker is heard saying.
>
>  "Oh, it's not something you want to just be turning on and off every
>  hour. Let's put it that way," another says.
>
>  "Well, why don't you just go ahead and shut her down."
>
>  Officials with the Snohomish Public Utility District near Seattle
>  received the tapes from the Justice Department.
>
>  "This is the evidence we've all been waiting for. This proves they
>  manipulated the market," said Eric Christensen, a spokesman for the
>  utility.
>
>  That utility, like many others, is trying to get its money back from 
> Enron.
>
>  "They're f------g  taking all the money back from you guys?"
>  complains an Enron employee on the tapes. "All the money you guys
>  stole from those poor grandmothers in California?"
>
>  "Yeah, grandma Millie, man"
>
>  "Yeah, now she wants her f------g money back for all the power you've
>  charged right up, jammed right up her a------ for f------g $250 a
>  megawatt hour."
>
>  And the tapes appear to link top Enron officials Ken Lay and Jeffrey
>  Skilling to schemes that fueled the crisis.
>
>  "Government Affairs has to prove how valuable it is to Ken Lay and
>  Jeff Skilling," says one trader.
>
>  "Ok."
>
>  "Do you know when you started over-scheduling load and making buckets
>  of money on that?
>
>  Before the 2000 election, Enron employees pondered the possibilities
>  of a Bush win.
>
>  "It'd be great. I'd love to see Ken Lay Secretary of Energy," says
>  one Enron worker.
>
>  That didn't happen, but they were sure President Bush would fight any
>  limits on sky-high energy prices.
>
>  "When this election comes Bush will f------g whack this s--t, man. He
>  won't play this price-cap b------t."
>
>  Crude, but true.
>
>  "We will not take any action that makes California's problems worse
>  and that's why I oppose price caps," said Mr. Bush on May 29, 2001.
>
>  Both the Justice Department and Enron tried to prevent the release of
>  these tapes. Enron's lawyers argued they merely prove "that people at
>  Enron sometimes talked like Barnacle Bill the Sailor."
>
>
>  Enron Tapes Anger Lawmakers
>  Part 2
>
>  During California's rolling blackouts, when streets were lit only by
>  head lights and families were trapped in elevators, Enron Energy
>  traders laughed, reports CBS News Correspondent Vince Gonzales .
>
>  One trader is heard on tapes obtained by CBS News saying, "Just cut
>  'em off. They're so f----d. They should just bring back f-----g
>  horses and carriages, f-----g lamps, f-----g kerosene lamps."
>
>  And when describing his reaction when a business owner complained
>  about high energy prices, another trader is heard on tape saying, "I
>  just looked at him. I said, 'Move.' (laughter) The guy was like
>  horrified. I go, 'Look, don't take it the wrong way. Move. It isn't
>  getting fixed anytime soon."
>
>  California's attempt to deregulate energy markets became a disaster
>  for consumers when companies like Enron manipulated the West Cost
>  power market and even shut down plants so they could drive up prices.
>
>  There was quick reaction in Washington to the Enron audiotapes first
>  aired by CBS News last night, and the tapes have become part of the
>  debate over the President's massive energy bill.
>
>  "People were talking about market manipulation. People were talking
>  about schemes, people were making jokes," said U.S. Sen. Maria
>  Cantwell, D-Wash.
>
>  "While the president would like to have an energy bill, I'd like to
>  have an energy bill that protects consumers," said Cantwell.
>
>  Consumers like Grandma Millie, mentioned in one exchange recorded
>  between two Enron employees.
>
>  Employee 1: "All the money you guys stole from those poor
>  grandmothers in California?
>
>  Employee 2: "Yeah, Grandma Millie man.
>
>  Employee 1: "Yeah, now she wants her f-----g money back for all the
>  power you've charged right up, jammed right up her a-for f-----g $250
>  a megawatt hour."
>
>  It's clear from the tapes that Enron employees knew what they were
>  doing was wrong, and now lawmakers are responding.
>
>  "I will offer an amendment to compel the Bush administration t oget
>  off the dime and get back this money that has been stolen," said Rep.
>  Jay Inslee, D-Wash.
>
>  Another taped exchange between different employees regarding a
>  possible newspaper interview goes like this:
>
>  Employee 3: "This guy from the Wall Street Journal calls me up a
>  little bit agoŠ"
>
>  Employee 4: "I wouldn't do it, because first of all you'd have to
>  tell 'em a lot of lies because if you told the truthŠ"
>
>  Employee 3: "I'd get in trouble."
>
>  Employee 4: "You'd get in trouble."
>
>  Eventually, the lies unraveled and traders scrambled.
>
>  "I'm just -- f--k -- I'm just trying to be an honest camper so I only
>  go to jail once," says one employee.
>
>  Two Enron traders, from the office where the tapes were made, have
>  admitted manipulating energy prices and pled guilty in court. Another
>  goes on trial in October. Former Enron chief Ken Lay is the only top
>  company official who has never been charged with any crime.
>
>
>  <end>
>
>
>
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