The AAJ (American Association for Justice) is asking Securities and Exchange Commission Chairman Chris Cox and General Counsel Brian Cartwright to address media reports that the SEC thought about supporting Merrill Lynch & Company during attempts by Enron shareholders to hold Enron banks accountable. The AAJ wants the SEC to publicly disclose the extent of its connections to Merrill Lynch.
On January 12, 2007, the AAJ turned in to the SEC a Freedom of Information Act request. The AAJ wants the SEC to disclose if, how, and when they communicated with Merrill Lynch regarding Enron and whether Counsel Cartwright and Chairman Cox have recused themselves from the Enron case because they had both once worked for the law firm (Latham and Watkins) representing Merrill Lynch. Also, the Center for Responsive Politics is reporting that Latham & Watkins was Chairman Cox’s largest contributor while he served in the U.S. Congress. The law firm reportedly contributed $124,594 on two separate occasions.
At least 30 states are supporting the Enron shareholders who have filed lawsuits against investment banks that are accused of taking part in accounting fraud because of the Enron scandal. Merrill Lynch is one of these banks.
Attorneys for the investment bank recently requested that the SEC file a brief supporting the firm in front of the U.S. Fifth Circuit Court of Appeals in New Orleans. According to an AP reporter, the SEC considered the request, although it had won tens of millions of dollars from Citigroup Inc., Merrill Lynch, and JP Morgan Chase & Co. because of their participation in the Enron Scandal in 2003.
According to AAJ Chief Executive Officer Jon Haber, “In light of the troubling reports that the SEC, at the request of a major Wall Street bank involved in the Enron scandal, considered interceding in a way that could harm shareholders, the public has a right to know if the fox is guarding the hen house. This is just the latest in a series of audacious moves by some in corporate America to roll back the Enron reforms and avoid accountability.”
Shepherd Smith Edwards & Kantas LTD LLP is dedicated to assisting investors nationwide to recover losses caused by inappropriate actions of stockbrokers and their firms. For more information, contact Shepherd Smith Edwards & Kantas LTD LLP today.
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