Pension Problems Take Center Stage In This Week's Enron Hearings
The House Education and the Work Force Committee, chaired by Representative John Boehner (R-Ohio), will take up the pension plan impact with hearings that begin on Wednesday with testimony from Department of Labor Secretary Elaine Chao (see Boehner Committee Looks for Enron Insights ). Those hearings will continue the next day with scheduled testimony from several Enron HR executives and Scott Peterson of Hewitt Associates, which took over the recordkeeping for the Enron 401(k) plan during the so-called ‘blackout’ period.
Pension Perspectives
On February 5 , the Senate Governmental Affairs Committee, chaired by Connecticut Democrat Chairman Joseph Lieberman, will focus on company employees who had substantial amounts of Enron stock in their 401(k) retirement accounts.
On February 7 , the Senate Health, Education, Labor and Pensions Committee, chaired by Senator Edward Kennedy (D-Massachusetts), will turn its attention to the topic of ‘Protecting America’s Pensions: Lessons from the Enron Debacle’ . Testimony is scheduled from Senators Barbara Boxer (D-California) and Jon Corzine (D-New Jersey), as well as former Enron – and Polaroid – employees. Senators Boxer and Corzine have put forth a proposal that would impose limits on the amount of company stock in all retirement plans (see Congress Proposes Limits on Employer Stock, Blackouts ).
Of course, plan sponsors can expect a great deal of media attention to focus on today’s hearings by the Senate Commerce Committee – or at least they would have prior to Enron CEO Kenneth Lay’s decision to withdraw from his scheduled participation in those hearings. Lay’s attorney Earl Silbert announced the decision in letters to the Senate and House panels that were to hear from him Monday – citing ‘prosecutorial’ comments made by Congressional leaders on Sunday talk shows.
‘He cannot be expected to participate in a proceeding in which conclusions have been reached before Mr. Lay has been given an opportunity to be heard,’ Silbert noted. The Senate Commerce Committee has now canceled its hearing.
Lay had also been scheduled to testify before the House Financial Service Committee on February 5 , along with Arthur Andersen CEO Joseph Beradino.
Other Hearings
Later today , the House Financial Services Committee subcommittee on capital markets, chaired by Louisiana Republican Richard Baker, will hear from SEC Chairman Harvey Pitt and Enron director William Powers, chairman of Enron’s special investigative committee. A 217-page report (the so-called ‘Powers Report’) containing details of that investigation was released Sunday.
On February 5 , House Energy and Commerce subcommittee on oversight and investigations, chaired by Pennsylvania Republican James Greenwood, will focus on the findings of Enron’s special investigative committee, with testimony scheduled from William Powers, chairman of that committee – and dean of the University of Texas School of Law ( Read the News Release ).
On February 7 , they are scheduled to hear from a number of Enron executives (current and former), including former Enron CEO Jeff Skilling and former CFO Andrew Fastow. Fastow, who the Powers Report says made as much as $30 million from the partnerships under question, is expected to exercise his Fifth Amendment right not to testify, according to a committee spokesperson. However, Skilling is expected to testify.