Enron probe focuses on White House

Enron: The biggest ever US corporate bankruptcy

Investigations into the collapse of the energy giant Enron have focused on the White House for the first time.

A United States Senate committee has issued 29 subpoenas to current and former employees of Enron and its accountants Arthur Andersen, demanding information about their political contacts during the past 10 years.

This is the first time any of the numerous congressional inquiries into the Enron bankruptcy has specifically sought information about its contacts with politicians.

The subpoenas seek details about Enron's political contacts

Recipients will be required to hand over documents about their White House contacts on energy policy during the administrations of both President George W Bush and former President Bill Clinton.

The move is significant because of allegations that Enron bosses took advantage of personal relationships with politicians, especially President Bush and Vice-President Dick Cheney, to influence their administration's energy policies.

According to Senate committee spokeswoman Leslie Phillips, those who will be receiving subpoenas include former Enron chairman Kenneth Lay, a long-time and generous donor to Bush's political campaigns, and Jeffrey Skilling, the company's former chief executive.

Enron director Wendy Gramm, wife of Texas Republican Senator Phil Gramm, and Lord John Wakeham, a former UK Conservative minister who left Enron's board last month are also expected to receive subpoenas on Monday.

Largest ever bankruptcy

In December 2001, Enron filed for the largest bankruptcy in US history, causing thousands of job losses and wiping billions of dollars from equity held mainly by Enron employees.

George Bush hopes to distance himself from the scandal

Investigations have since been taking place into Enron's collapse and the conduct of its accountancy firm Arthur Andersen, which has been charged with obstruction of justice for shredding Enron-related documents.

President Bush has sought to keep a distance from the scandal, and so far the political fallout has been limited.

Bush administration officials admit that Mr Lay contacted them last year as the company spiralled into bankruptcy, but insist they did nothing to help and the president was unaware of it.

Congress vs White House

The move opens a new front in the political row between Congress and the White House over Enron.

The Government Accounting Office - a congressional agency - is already suing the Bush administration for records of discussions involving its energy task force.

Their actions could force the Bush camp to hand over sensitive information about corporate contacts.

This is not directed at the administration, this is directed at Enron

Leslie Phillips, Committee spokewoman

The 29 subpoenas have been issued by a different set of congressional investigators, who are tackling the issue from the other side - by requiring that Enron gives information about its links with government.

Leslie Phillips denied that the Senate committee was trying to pull the White House into the Enron debacle.

"This is not directed at the administration, this is directed at Enron. We're looking for the story of Enron's communications with the government, with the goal in mind of keeping this from happening again," she said.