Running Head:ENRON SCANDAL

Enron Scandal

Enron Scandal

Introduction

In 1930, Northern Natural Gas, a Nebraska-based gas pipeline company was founded and therefore started The Enron Corporation as one of the worlds's premier energy companies. In December 2001, Enron filed the biggest business bankruptcy claim in joined States history. The company's disintegrate directed to investigations of both Enron and Arthur Andersen, an accounting firm engaged by Enron. Investigators were notified to allegations that Enron on purpose concealed its economic difficulties, misled investors, and failed to pay income taxes. Since January, 2001 Enron's likeness has been tarnished making their supply today worthless. With corrupt bosses and the help of their auditing firm, Enron has been able to provide investors with untrue financial information which provided investors a untrue image of the company's factual state of affairs. The disintegrate of Enron has made thousands of employees lose their life savings in 401k designs and business supply holdings. Investors were defrauded out of billions of dollars and everyone started asking the question, "How did this occur, and can we avert this from happening again?"

Company History

The Enron company was renamed InterNorth in 1980 and bought Belco Petroleum in 1983. InterNorth also assisted construct the to the north boundary Pipeline to link Canadian fields with the joined States markets. (C-Span.com, 2002) Houston Natural Gas (HNG) formed in 1925 and bought Houston Pipe-Line Company in 1956 and Valley Gas Production in 1963. HNG traded its initial distribution properties to Entex in 1976. In 1984, the bosses refocused HNG on natural gas and added Transwestern Pipe-line and Florida Gas Transmission. (WashingtonPost.com, 2002)

By 1985, HNG functioned the only transcontinental gas pipeline. In 1985, InterNorth acquired HNG, conceiving the joined States' largest natural gas pipeline system. Once these businesses amalgamated, it was renamed Enron. The headquarters were then moved from Omaha to Houston. In 1992, Enron and three partners acquired command of a 4,100-mile pipeline in Argentina. Enron bought several gas enterprises from gas foremost Williams in 1993 and started its power marketing enterprise as the global electrical energy markets started deregulating.

In 1997, Enron acquired its own electric utility, Portland General electric powered (PGE). In 1998, Enron started power swapping in Australia and became the first power marketer in Argentina. The business continued to elaborate buying power plants near New York town as well as buying more businesses globally such as Wessex Water in the joined Kingdom and businesses in India and China. In 2000, Enron assisted its retail residential energy business to The New Power Company. This assistance was to contend in deregulated US markets.

Enron also purchased worldwide metals marketer "MG plc" in a 2 billion dollar deal, then sold Houston Pipe Line Company to American Electric Power in 2001. It also agreed to deal Portland General electric powered (PGE) to another Oregon utility, Northwest Natural Gas. Later that year, the business broadcast that it would sell its Indian gas assets to UK oil and gas group and they furthermore announced designs to sell their power plant in ...