In theory, the Enron scandal should never have happened.
US financial markets are supposed to be the best regulated in the world, with the Securities and Exchange Commission (SEC) enforcing strict rules on disclosure to protect investors, and private agencies also monitoring companies.
But Enron’s accounts proved impenetrable to government and private regulators alike, while its main business - energy trading - was only lightly regulated by another set of government agencies which exempted it from many reporting requirements, while maintaining close ties with the company.
Now Enron executives may face criminal charges for fraud as investigations are underway by the SEC, the US Department of Justice and the FBI.
In addition, 11 Congressional committees are holding hearings to find out what went wrong and to look at possible changes in laws and regulations.