Prosecutors reject notion of immunity to former Enron chairman Kenneth Lay
By MARCY GORDON
Associated Press

WASHINGTON — On Tuesday, former Enron chairman Kenneth Lay will become the sixth person to cite the Fifth Amendment and decline to testify in Congress inquiry. For now, lawmakers reject the idea of offering immunity from prosecution to get them talking.

“I do not support immunity,” Sen. Byron Dorgan, D-N.D., who is heading one of Congress’ investigations, said Monday. “I think it jeopardizes the potential criminal prosecution.”

Immunity “is not even on our radar screen” declared Ken Johnson, spokesman for Rep. Billy Tauzin, R-La., whose House Energy and Commerce Committee also is investigating. “Too many people got burned ... for us to be offering immunity to anyone.”

Prosecutors pursuing convictions of people with congressional immunity must prove their case is not derived from the public testimony. They also must show that witnesses or jurors had no knowledge of the testimony.

Last week brought the spectacle of grim-faced Enron officials standing before a congressional hearing with their right hands raised, swearing to tell the truth, then saying they were invoking their right against self-incrimination and refusing to answer questions. It recalled the televised drama of Lt. Col. Oliver North and Iran-Contra in the late 1980s.
Convictions against North and National Security Adviser John Poindexter were set aside by courts concerned that the criminal cases had been impermissibly tainted by testimony the men gave Congress under grants of immunity.

“Iran-Contra’s a case study in failure,” Dorgan said in a telephone interview.

Lawmakers don’t want a repeat of that in the biggest bankruptcy in U.S. history, which brought losses to millions of investors big and small, and stripped thousands of current and former Enron employees of the bulk of their retirement savings in accounts loaded with Enron stock. The members of Congress stress that in pursuing their inquiry, they don’t want to interfere with the Justice Department’s criminal investigation of Enron and its longtime auditor, the Arthur Andersen accounting firm.

The Securities and Exchange Commission is pursuing a civil inquiry into Enron and Andersen, which has acknowledged massive destruction by its employees of Enron-related documents.

And overhanging the Enron case is the fact that senators and House members of both parties received at least $700,000 in campaign donations from the politically active company.

The political sensitivity was highlighted by a CNN-USA Today-Gallup poll out Monday showing four in five people think Congress should investigate the ties the Bush White House had with Enron executives.

People are about evenly split on whether the White House is trying to cover up its contacts with Enron or cooperate as much as possible.

So with five key Enron officials — including Lay and former chief financial officer Andrew Fastow — and one Andersen auditor refusing to answer questions, and no immunity on the table, how will Congress be able to unravel the case?

Fastow ran Enron’s web of thousands of partnerships, used to keep some $500 million in debt off the company’s books and hidden from investors and federal securities regulators. He collected at least $30 million for his efforts, and other Enron officials also reaped millions from the partnerships.

“We’re going to get to the bottom of this pretty quickly,” Tauzin promised Sunday.
He and others say they already have strong evidence of illegal activity surrounding the failure of the energy-trading company.

Filling the gap of the Enron officials’ silence are boxes of documents subpoenaed by congressional investigators and interviews with lower-level Enron employees.

“There’s more than one way to skin a cat,” said Johnson, the Tauzin spokesman. “We are pursuing other leads.”

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