JP Morgan And Citigroup In Enron Fight

10 years ago

All is not well as hundreds of lawyers in a Manhattan bankruptcy court are carving up what remains of failed energy giant Enron. With billions of dollars at stake, some of the creditors are questioning whether it is right for JP Morgan and Citigroup to sit on the creditors committee when, they contend, the banks themselves were partly responsible for many of Enron's financial problems.

Both banks are subject to government investigations and private lawsuits as a result of their involvement with Enron and some of the creditors are now crying conflict of interest.

The creditors committee itself will be very influential in deciding the allocation of residual funds to shareholders, employees and unsecured creditors.
Efforts are now being made to disqualify both banks from the 15-member committee although, with only one vote each, it is thought unlikely that they will have a major influence on events and that they will be ordered off the panel.

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