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Enron gives FERC more data on possible sham power trades

Bankrupt Enron Corp gave federal energy regulators a review of possible sham energy trades conducted by other companies over the online trading system it once ran, an Enron spokesman said on Tuesday.

In an interview with Reuters, spokesman Eric Thode declined to say whether the new data implicates other electricity and natural gas traders in so-called "wash" trades.

California officials have blamed wash trades -- the simultaneous purchase and sale to the same party -- for contributing to the state's power crisis and soaring prices in late 2000 through mid-2001. California is seeking refunds of nearly $9 billion for alleged overcharges by several wholesale electricity suppliers.

Enron was ordered to turn over the data by the Federal Energy Regulatory Commission, which is trying to determine if any companies used wash trades to boost revenue, distort trading volumes or influence market prices.

Enron has not publicly acknowledged using wash trades for its own account.

More than a month ago, Enron gave the FERC the entire database of trades conducted on its once-giant EnronOnline Web site. On Monday, Enron also gave the agency a list of online trades that may fit FERC's definition of a wash trade, the spokesman said.

"We did provide data to them that may meet their definition, but we're going to leave it up to FERC to make any comments because they're doing their own analysis," Thode said.

FERC officials refused to comment on the investigation.

UBS Warburg, owned by Switzerland's biggest bank, UBS AG, bought Enron's giant web trading portal and reactivated it in February as UBSWenergy.com. The website is run by 630 former Enron employees, including Enron former president and chief operating officer Greg Whalley, who runs the operation out of Enron's old trading floor in downtown Houston.

FERC, SEC, CFTC PROBES

The FERC is one of several federal agencies examining energy trading practices.

Last week, Enron's Portland General Electric Co affiliate was subpoenaed by the US Commodity Futures Trading Commission to produce records on wash trades. The CFTC regulates futures contracts traded on US exchanges.

The Securities and Exchange Commission is also probing whether any energy companies pumped up their balance sheets with wash trades in a way that might mislead stock investors.

In May, the FERC demanded information from more than 100 energy firms about wash trades in the West Coast market.

A key source of information in the FERC's investigation is the database of EnronOnline, the once-dominant energy trading system until it shut down late last year when Enron sought bankruptcy protection.

EnronOnline was the firm's proprietary platform to execute over-the-counter trades in commodity markets including crude oil, natural gas, electricity, and fiber-optic capacity.

In all deals, Enron was either the buyer or the seller, but did not know the identity of the counterparty until the transaction was closed.

That reduced the possibility for wash trades, according to the Enron spokesman. "A wash trade by definition would require two human beings discussing among themselves to buy and sell a product at a given time and a given price," he said.

Several energy firms -- including CMS Energy Corp, Reliant Resources Inc and Dynegy Inc -- have admitted the use of wash trades.

Earlier this month, Williams Cos, El Paso Corp, Calpine Corp and Duke Energy Corp told FERC a small number of trades on their books might appear to be wash trades but were actually used to hedge prices.

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