The following appeared in the January,
2002 Editorial Page of the Journal Inquirer.
The failure of State elected officials to put controls on taxpayer
financed State quasi-public agencies resulted in a $220 million dollar loss of
taxpayer dollars in the Enron-CRRA debacle. Today, corporate welfare at the
state is alive and well. Our State tax
dollars are being given to corporations with no requirement to disclose their
financial status to the public.
POWER
BROKERS, SECRET DEALS,
and PUBLIC
MONEY!
By: Susan Kniep, Vice President, FCTO
Few
will escape the financial, political and legal consequences of the “cook the
books” scheme by Enron and the accounting firm of Arthur
Andersen. Enron’s glitzy campaign money machine blinded
many public officials to Enron’s meltdown, while leaving victims in its
path. From Enron employees who have lost their jobs and life
savings to the Connecticut taxpayers and ratepayers who will be paying for the
Enron – CRRA debacle for years to come, the obvious question is where were
government and stock market regulatory agencies charged with protecting
the public’s interests.
Investigators
focusing on Enron deals in Connecticut should determine and disclose if power
brokers were involved and profited.
With CRRA's President trying to recoup his $220 million loss from
Connecticut taxpayers, the ultimate question is who brought Enron to the table
with CRRA and CL&P and were finder's fees involved. If so, the
Attorney General should attempt to attach those fees before creating more
innocent victims in this high stakes public money game.
As
recently as January, 2001, CRRA President, Robert Wright, offered the following
response to questions by the DPUC “Enron came to CRRA with the proposal for a
fuel cell facility at CRRA’s South
Meadows Plant. CRRA did not
solicit that proposal. CRRA has no request for proposal. Correspondence, memos and agreements between
CRRA and Enron are the subject of a confidential agreement. The information contained therein is confidential
and proprietary. And is a 'Trade Secret'.”
Wright further testified that
although there was a meeting in August, 2000 at the offices of CRRA between
representatives of Enron, Connecticut Innovations, Inc.(CII)/Clean Energy Fund
and CRRA, there were no minutes and the handouts were trade secret!
Yet, much of the money under the control of CII and CRRA, both
quasi-public agencies, is raised through a charge on ratepayers’ bills
and taxes. The DPUC is a public agency.
Regrettably,
secret deals infused with public money continue to mire the political landscape
in Connecticut. From Colonial Realty
to the Silvester scandal to the Enron debacle, lack of government oversight has
allowed political insiders to prosper at the expense of the honest, hardworking
public. The fuel of the political
engine is a combination of public tax dollars, lobbying fees, employee pension
funds, and lucrative campaign contributions from special interests fused by
conflicts of interest. Government
business is no longer transacted in the public arena but under a cloak of
secrecy among public officials and the power brokers who control them.
This
was never more evident than in the Paul Silvester and Colonial Realty
scandals. Silvester pleaded guilty to racketeering and
money laundering charges in September 1999.
He admitted that when he served as State Treasurer he accepted kickbacks
from companies in which he invested hundreds of millions of state pension fund
dollars. While the State and Federal
government pursued Silvester, the State’s Ethics Commission pursued Peter
Kelly, former Democratic National Committee Finance Chairman, and John Droney
former Democrat State Chairman, who
characterized themselves as “door openers” when they collected millions of
dollars for arranging state pension fund investments.
In the mid 1990s, Connecticut
witnessed the collapse of Colonial Realty due to unscrupulous business
practices which went undetected by government. Hundreds of millions
of investor dollars were lost. Similar to the Enron debacle, the
accounting firm of Arthur Andersen destroyed incriminating
documents. One would have thought that this and other
surreptitious dealings by Andersen would have been enough to permanently remove
them from the accounting field before they had an opportunity to destroy more
lives!
When
the money game involves public funding, government should impose strict
conflict of interest and campaign financing laws and enforce strict oversight
over quasi-public agencies.
A
recent visit to the web site of Peter Kelley’s lawfirm Updike, Kelly and
Spellacy, informs the public that they have been active in
the deregulation efforts and initiatives in the telecommunications and electric
industries within the State of Connecticut, active as a lobbyist for major
electric and telecommunication providers before the General Assembly and within
the dockets maintained by the Department of Public Utility Control
("DPUC") to implement these initiatives, closed transactions on
behalf of their client Connecticut Innovations (CII), and represented the Clean
Energy Fund.
I
believe it is fair to question if a conflict exists with any law firm
lobbying for the interests of any electric provider, which could benefit from
financing through the client of that law firm, which may have access to and is
responsible for disseminating public money.
The
public is entitled to full disclosure of all Enron-CRRA-CII-CL&P documents
hidden under the cloak of “Trade Secrets”.
We are further entitled to know who brought Enron to CRRA’s table and if
finders fees were involved.
The Enron deal of today, may be replayed in another workplace
tomorrow unless the public, whose money is being stolen from them, demands
accountability from their elected officials.