Andersen Proposes New Settlement to Justice Department
With just eleven days to go before a scheduled May 6 trial date, Arthur Andersen LLP has made a new settlement offer to the U.S. Department of Justice in the pending matter of obstruction of justice charges. The settlement was delivered in a letter Wednesday afternoon.
Andersen has offered to publicly admit that some employees of the firm improperly destroyed documents relating to the audit of now bankrupt Enron Corp. In addition, the firm would agree to collaborate with the Justice Department in its investigation of Enron.
There is no word yet as to whether the Department of Justice will accept the terms of the settlement.
Negotiations between Andersen and the Justice Department ended last week when Andersen refused to meet the terms offered by the Justice Department.
In related news, the U.S. District Judge who will be hearing the Andersen cases, has agreed to excuse C.E. Andrews, managing partner for Andersen's audit practice, from the pending class action lawsuit against the firm. Mr. Andrews is a member of the team that is working to reorganize Andersen and there is speculation that he could become the firm's chief executive officer, replacing Aldo Cardoso, currently the firm's acting CEO.
The class action suit, let by the California Board of Regents, seeks restitution for investors who lost money on the bankruptcy of Enron after relying on financial statements signed by Andersen.