Analysts In The Dock

Bloomberg reports that analysts from JP Morgan Chase, Lehman, CSFB and Citigroup will be questioned by US congressional investigators Friday as they attempt to come to grips with what really happened at Enron.

Investigators will probe analysts in an effort to establish why 'buy' recommendations were still being issued in Enron at a time when the corporate was heading towards bankruptcy.

Consumers Union counsel, Frank Torres, who will appear as an expert witness at the hearings, has said; 'More and more reports are coming out that analysts were afraid to downgrade their recommendations on Enron because they were afraid that Enron would stop doing business with their company.'

This move follows hot on the heels of similar accusations made against investment banks at the recent congressional hearings related to analysts misleading investors during the internet IPO boom in the late '90s.