Expert to study Enron assets: judge - Feb. 21, 2002

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News

Expert to eye Enron assets
Judge seeks examiner to help settle claims against company subsidiary.
February 21, 2002: 1:55 p.m. ET

NEW YORK (CNN/Money) - A U.S. bankruptcy court judge Thursday ordered the appointment of a financial expert to audit the finances of Enron Corp.'s biggest subsidiary, after creditors claimed the unit's assets were being improperly distributed.

Judge Arthur Gonzalez made his decision after creditors filed motions saying Enron Corp. may be improperly dispersing assets belonging to the subsidiary, Enron North America.

Gonzalez told the trustee administering the bankruptcy to name an examiner to look into Enron North America's finances. The unit generated a big chunk of Enron's $101 billion in sales last year, which made it the nation's seventh-biggest company before it filed for bankruptcy in December.

Creditors say that Enron North America assets possibly worth as much as $13 billion are at stake, according to David Bennett of law firm Thompson & Knight, which represents many large creditors.

Gonzalez hopes to settle whether the assets should be controlled by Enron Corp. or Enron North America, Bennett said.

Creditors welcomed the appointment, since the move could help them win a larger share of Enron's assets. �

"The ultimate relief would have been to stop the sweep-up of funds to Enron Corp. from Enron North America," Bennett told Reuters news agency. "The judge didn't order that, but we got the next best thing."

-- from staff and wire reports

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