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Friday, 15 March, 2002, 17:25 GMT
Andersen UK denies Enron cover-up
The UK arm of troubled accountancy firm Andersen has said suggestions it was involved in the destruction of documents relating to the collapse of US energy giant Enron are "outrageous".

A federal grand jury has indicted the US company on the charge of obstruction of justice, claiming it destroyed data on Enron, whose accounts it audited.

The prosecution says important documents were shredded, both in the US and at the firm's London office.


No UK personnel were involved or at fault in any way

Andersen UK spokesman

But Andersen UK has strongly denied this, and attacked the US Department of Justice's action.

Andersen's senior partner John Ormerod told the BBC: "Suggestions of any inappropriate action in the UK are outrageous.

"The Department of Justice has never visited the UK."

He said Andersen UK had carried out a "very careful review" of its own, with independent advice.

'Routine documents'

"Our solicitors, Herbert Smith, reviews what we had done and they concluded, as we did, that there was no inappropriate action in the UK."

Andersen UK confirmed to BBC News Online that documents were shredded at its office, but insisted that none of its staff were involved and that the data destroyed was contained in routine documents.

A spokesperson said: "No UK personnel were involved or at fault in any way."

She said the documents were shredded by three secondees from Andersen's Houston, Texas office - two managers and a partner - under instructions from Houston last year.

Andersen UK was unaware that the shredding was taking place, she said.

The Enron collapse, which left investors nursing heavy losses and wiped out many former employees' retirement savings, was the biggest bankruptcy in US corporate history.

Irregularities

The energy firm filed for bankruptcy protection in December following revelations it had concealed millions of dollars in debts using a complex series of external partnerships.

Andersen, which audited Enron's accounts, failed to spot irregularities in the bankrupt energy giant's books.

The company has also admitted that some employees at its Houston office shredded documents relating to the Enron account.

In a statement issued on Friday, Andersen said its non-US firms were looking at the implications of the federal action, and "considering a number of options to address the concerns of clients".

UK financial watchdog the Financial Services Authority said the issue was not something it would get involved in at this point.

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The BBC's Rory Cellan Jones
"In the US it is already losing some of its biggest clients"
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