Statement of Senator Dianne Feinstein
on the Guilty Plea of
Enron Energy Trader
October 17, 2002
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"It has been
reported that the former head of trading in Enron's Oregon office will
plead guilty to one charge of conspiracy to commit wire fraud. This guilty
plea clearly indicates that fraudulent practices were used to manipulate
energy prices in California during the Energy Crisis.
I do not
believe this fraudulent activity begins or ends with this one individual -
in fact, we know traders from other companies have engaged in similar
behavior. This type of manipulation contributed to the increase in the
price of power from $30 per megawatt hour to more than $2,000 a megawatt
hour, in some cases.
That is why I am so deeply concerned about the
reluctance of Congress to move ahead with a bill that I introduced to
provide fraud and manipulation oversight of energy
transactions.
The legislation would ensure that records are kept
for all energy transactions and would give the Commodity Futures Trading
Commission (CFTC) regulatory authority over all energy derivatives
trades.
The legislation would also require companies that run
on-line trading forums to maintain open books and records for
investigation and enforcement purposes, disclose non-proprietary pricing
information, and, if appropriate, maintain necessary capital to back up
their trades.
This bill has had a hearing in committee, but it has
not yet been marked up. I think it is well past time for the Congress to
take up and approve this legislation."
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