NEW YORK (CNN/Money) - Eleven insurance companies allege that J.P. Morgan Chase & Co. conducted "round-trip trades" with now bankrupt Enron in an attempt to limit its financial exposure as the energy trader collapsed, according to a published report Monday.

The insurance companies claim J.P. Morgan knew Enron was in trouble and needed fresh financing in order to keep making interest payments on J.P. Morgan loans and Morgan is liable for more than $1 billion in financing gone bad, the Wall Street Journal reported.

Documents filed by the insurance firm allege that J.P. Morgan bought natural gas from Enron and then sold it back to the company at a higher price, effectively making the difference an interest payment on a J.P. Morgan loan, according to the Journal.

J.P. Morgan "knew that unless something was done to bolster or otherwise support Enron's precarious financial condition, of which [J.P. Morgan] had knowledge, it would never be able to recover those loans," the paper reported, citing documents filed by the insurers.

J.P. Morgan claims the insurance companies are liable for the defaulted loans because they covered the trades with "surety bonds," the paper said.

"We believe the insurance companies' allegations have no merit and are simply an attempt to get out of paying a straightforward claim, " J.P. Morgan told the Journal.

The insurance companies filing the documents include Liberty Mutual Insurance Co., Safeco Insurance Co., St. Paul Fire & Marine Insurance Co., and Travelers Property Casualty Corp.

"Round-trip trades" have come under scrutiny lately as the Securities and Exchange Commission is investigating the practice by CMS Energy (CMS: Research, Estimates). Reliant Energy (REI: Research, Estimates) and Dynegy (DYN: Research, Estimates) also have admitted to using the trades.

Shares of J.P. Morgan (JPM: Research, Estimates) fell 39 cents Friday to close at $32.99.