Firm looked into Enron complaints

Enron Corp.’s outside law firm conducted a cursory inquiry in fall 2001 of accounting complaints raised by former finance executive Sherron Watkins. The investigation involved asking executives and accountants who had already approved financial structures if they were proper, Max Hendrick III, a lawyer with the firm, testified Wednesday in the criminal fraud and conspiracy trial of Enron founder Kenneth Lay and former chief executive Jeffrey Skilling.

Watkins, a former Enron vice president, met with Lay in August 2001 to tell him the company needed to come clean about potentially disastrous accounting tricks she had found.

Her prosecution testimony last month about that meeting was intended to bolster government allegations that Lay knew Enron was in financial turmoil when he claimed publicly the company was strong in the fall of 2001.

The company collapsed into bankruptcy proceedings in December 2001.

Detroit

Bankruptcy not an option, Ford says

Ford Motor Co. Chairman and CEO Bill Ford said Wednesday that bankruptcy isn’t an option for the nation’s No. 2 automaker, which is struggling to return its North American division to profitability.

Ford said the company has strong liquidity – with about $20 billion in cash – and that regions outside North America are performing well.

Ford earned $2 billion last year, down 42 percent from a year earlier but still its third consecutive yearly profit.

Nonetheless, Ford’s North American division lost $1.6 billion last year, and the automaker’s debt rating has been slashed to below investment grade.

Compiled from wire reports