White House told to save files
Order by Justice Department links Bush administration to Enron probe

Feb. 2, 2002, 9:03PM
Copyright 2002 Houston Chronicle Washington Bureau

WASHINGTON -- The Justice Department ordered the White House Friday to retain Enron-related documents, linking the Bush administration and the criminal investigation of Enron for the first time.

"We believe that documents in the possession of the White House, its staff and
employees may contain information relevant to our investigation into ... Enron and statements made by Enron employees," said a letter from Christopher Wray, a Justice Department official overseeing the probe.

The letter, addressed to White House counsel Alberto Gonzales, made clear that the records were not being subpoenaed. "At this time, we are only requesting that you ensure the retention of these records," it said.

As described in the letter, virtually any record by any member of the White House staff would be covered by the request.

"In the present circumstances ALL documents relating to these subjects should be preserved, even if there would be a question whether its ... destruction might otherwise be permitted," the letter said, emphasizing the word "all."

"We will fully comply with the request as part of our ongoing commitment to being fully cooperative," White House spokeswoman Claire Buchan said Friday night.

A Justice Department spokesman said that agency would have no comment on the letter, citing a policy against talking about ongoing investigations.

But one official described the letter as "routine" in white-collar fraud investigations. That official said such letters cast a broad net for "records that may or may not eventually become relevant to an investigation."

At a later stage, records that are determined to be critical to the criminal investigation -- if any -- would be subpoenaed.

The letter comes as Bush has sought to keep the investigation of Enron at arm's length, despite his long political support from the company's former chairman, Ken Lay.

The Enron collapse sent the nation's seventh-largest company into bankruptcy and wreaked financial havoc on workers, and stockholders.

Several other federal agencies were also told to preserve Enron documents, officials said, and the White House was told to save documents from the last two years of the Clinton administration.

"While we realize that documents from the previous administration would not ordinarily be in your custody, any documents from Jan. 1, 1999, to the present are covered by this request," the letter said.

Clinton officials had contacts with Lay and Enron that Justice Department officials have said may also be reviewed in what is expected to be a wide-ranging federal inquiry.

The Bush White House has acknowledged a number of contacts with Enron last year, although they say the president never talked with company officials about their financial problems.

Last fall, Lay called Commerce Secretary Don Evans and Treasury Secretary Paul O'Neill to discuss possible federal help for the company.

Bush's top economic adviser, Larry Lindsey, who had previously been a consultant to Enron, also conducted a study of how the Houston company's collapse might affect the energy market and concluded nothing should be done.

Army Secretary Thomas White, a former top executive at Enron, has acknowledged frequent meetings and conversations with his former colleagues in Houston. As former vice chairman of Enron Energy Services, White lobbied the federal government for a long-term contract to provide energy services to an Army base in Brooklyn, N.Y.

Lay also met a number of times with Vice President Dick Cheney and his energy task force.

At one of those meetings, Lay presented the vice president with a list of candidates for the Federal Energy Regulatory Commission. Bush chose two from the list, including Texas Republican Pat Wood, who was named the commission's chairman.

Wood this week launched an investigation into whether Enron helped prolong last year's electricity crisis in California by unfairly manipulating wholesale power prices.

The Justice Department announced last month that it was conducting a criminal investigation into the Enron collapse, seeking to determine whether the company violated federal security laws.

Investigators also are probing whether employees of Enron or its former auditor, Arthur Andersen, obstructed justice by destroying documents that would have revealed improper behavior.

Also on Friday, the fight to force the White House to turn over documents on Cheney's energy task force meetings with Enron and other business executives continued.

Rep. Henry Waxman, D-Calif., who earlier this week sent a letter to Cheney urging him to release the records, posted on his Web site a fact sheet on the Bush administration's release of records from the Clinton administration.

Waxman, the ranking minority member of the House Committee on Government Reform, has been conducting his own investigation of the Enron matter; his committee is not investigating.

On his Web site, Waxman pointed out that the White House has "vigorously opposed" release of the energy task force's records and last year stalled the release of records from the Reagan White House.

"In contrast," the fact sheet says, "President Bush has approved the release of thousands of pages of records from the Clinton White House."

Those records include e-mails from former Vice President Al Gore's office and records of Clinton's presidential pardon decisions.

The White House has said that Cheney's task force met with Enron executives at least six times last year, but Cheney and Bush have taken the stance that releasing records on the meetings would encroach on the executive branch's ability to solicit input from outside groups.

Earlier this week, the General Accounting Office, the investigative arm of Congress, threatened to file an unprecedented lawsuit against the White House in the next few weeks if Cheney doesn't reconsider and provide the information.

And on Thursday, a federal judge presiding over a separate lawsuit on the matter ordered the administration's lawyers to file briefs explaining the White House's constitutional argument for withholding details of the meetings.

The briefs are to be filed by the end of the day Tuesday in a lawsuit that Judicial Watch, a public interest law firm that acts as a watchdog on government, filed in U.S. District Court in Washington last July. The law firm, which also took the previous administration to court during President Clinton's tenure, is seeking the minutes from Cheney's task force meetings, as well as information on where and when the meetings were held and who attended.

Saying he has insufficient information to decide the case, which is scheduled to be heard Feb. 12, Judge Emmet Sullivan instructed the task force's lawyer to explain in writing how releasing the information would interfere with the president's constitutional power to obtain candid and confidential advice from his advisers.

Judicial Watch will be expected to file its response to the White House briefs by next Friday.

"Obviously, limited discovery into these areas raises no constitutional concerns," said Larry Klayman, Judicial Watch's chairman and general counsel. "We request again that Vice President Cheney's energy task force comply with the law and let the `sun shine in.' "




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