Book Reviews | Gordon Campbell | News Flashes | Scoop Features | Scoop Video | Strange & Bizarre | Search

 


SEC Should Probe Sale Of Army Secretary’s Mansion

SEC Should Probe Sale Of Army Secretary’s Mansion


By Jason Leopold

A lifelong Army veteran with no corporate experience takes a job at an upstart energy company, earns tens of millions of dollars in questionable stock sales before the company goes belly up and lands a powerful position working in the administration of the President of the United States.

Such is the story of Army Secretary Thomas White, the former vice chairman of Enron, who proved to the nation Friday that his tenure at the disgraced energy company paid off well when he sold his Florida mansion for a staggering $13.9 million. Meanwhile, thousands of Enron investors lost billions of dollars and employees of the company lost their life savings when the company imploded a year ago in a wave of accounting scandals.

But White, like other Enron executives, has repeatedly denied having any knowledge of the company’s financial machinations, despite the fact that the unit he ran, Enron Energy Services, inflated the value of its energy contracts—according to dozens of former employees—and has been directly linked to the California energy crisis. Had the true value of EES’ contracts been known to investors, White would not be the wealthy man that he is today and might very well be living in a one-bedroom apartment in Washington, D.C.

Now White is getting ready to lead hundreds of thousands of the country’s soldiers into a war with Iraq. This is a man that clearly should not be managing a multi-billion military budget.

Nor should he be serving in the administration of the President. Even though White testified about his work at Enron before a senate committee hearing last July, there are numerous questions about his sale of Enron stock shortly before the company collapsed that have yet to be answered. The sale of his home—where anti-war activists have recently staged protests—will only fuel speculation that White did indeed use inside information to unload the bulk of his Enron stock before the company filed what was then the largest bankruptcy in U.S. history. At best, the Securities and Exchange Commission should revisit that issue.

White bought the beachfront property in 2000 for $6.5 million. He tore down an adjacent 2,000 square-foot home and built a 15,145 square-foot mansion and invested $10.5 million of his own money into the construction, which was completed last month.

In May of 2001, White was tapped by President Bush to serve as Secretary of the Army. He sold some of his Enron shares, but not all of it as required by law. In October 2001, while the nation was still reeling from the September 11 terrorist attacks and ground troops were dismantling the Taliban government in Afghanistan, White made dozens of phone calls to his former Enron colleagues.

He testified before the Senate committee that he was “concerned” about his old friends, but after those phone calls White unloaded the rest of his stock. Between May and October of 2001, White sold 405,710 shares for $14 million. Meanwhile, Enron’s lower-level employees were restricted from selling their own shares. It’s common knowledge that White financed his Naples home with proceeds from the sale of Enron stock. But if White was concerned that he wouldn’t be able to complete his mansion and needed to know whether he should dump his shares of Enron, then that is clearly a violation of insider trading laws.

Senate Democrats must reopen this issue and demand that White explain whether the construction of his mansion coincided with his sale of Enron stock, and whether the proceeds from the October sale helped to fund the project.

President Bush said in his State of the Union speech Tuesday that he would be tough on the corporate executives who commit white-collar crimes. The President should start with his own administration, particularly Secretary White.

Bush may have the only presidential administration in history that has been accused of misdeeds while working in the corporate sector and have treated the most vicious corporate scandals with a mere slap on the wrist. But that’s what you get when you have a bunch of ex-CEO’s running the country.

*******

- Jason Leopold is a freelance journalist based in California, he is currently finishing a book on the California energy crisis. He can be contacted at jasonleopold@hotmail.com.

© Scoop Media

 
 
 
 
 
Top Scoops Headlines

 

Werewolf: Living With Rio’s Olympic Ruins

Mariana Cavalcanti Critics of the Olympic project can point a discernible pattern in the delivery of Olympics-related urban interventions: the belated but rushed inaugurations of faulty and/or unfinished infrastructures... More>>

Live Blog On Now: Open Source//Open Society Conference

The second annual Open Source Open Society Conference is a 2 day event taking place on 22-23 August 2016 at Michael Fowler Centre in Wellington… Scoop is hosting a live blog summarising the key points of this exciting conference. More>>

ALSO:

Buildup:

Gordon Campbell: On The Politicising Of The War On Drugs In Sport

It hasn’t been much fun at all to see how “war on drugs in sport” has become a proxy version of the Cold War, fixated on Russia. This weekend’s banning of the Russian long jumper Darya Klishina took that fixation to fresh extremes. More>>

ALSO:

Binoy Kampmark: Kevin Rudd’s Failed UN Secretary General Bid

Few sights are sadder in international diplomacy than seeing an aging figure desperate for honours. In a desperate effort to net them, he scurries around, cultivating, prodding, wishing to be noted. Finally, such an honour is netted, in all likelihood just to shut that overly keen individual up. More>>

Open Source / Open Society: The Scoop Foundation - An Open Model For NZ Media

Access to accurate, relevant and timely information is a crucial aspect of an open and transparent society. However, in our digital society information is in a state of flux with every aspect of its creation, delivery and consumption undergoing profound redefinition... More>>

Keeping Out The Vote: Gordon Campbell On The US Elections

I’ll focus here on just two ways that dis-enfranchisement is currently occurring in the US: (a) by the rigging of the boundary lines for voter districts and (b) by demanding elaborate photo IDs before people are allowed to cast their vote. More>>

Ramzy Baroud: Being Black Palestinian - Solidarity As A Welcome Pathology

It should come as no surprise that the loudest international solidarity that accompanied the continued spate of the killing of Black Americans comes from Palestine; that books have already been written and published by Palestinians about the plight of their Black brethren. In fact, that solidarity is mutual. More>>

ALSO:


Get More From Scoop

 
 
 
 
 
 
 
Top Scoops
Search Scoop  
 
 
Powered by Vodafone
NZ independent news