The Canadian Imperial Bank of Commerce (CIBC) has agreed to pay 2.4 billion dollars (that's billion with a "b") to settle charges that its executives helped Enron executives hide losses from investors in a series of eye-wateringly complicated financial frauds. The 2.4 billion dollar settlement is the largest individual settlement so far in the ongoing Enron financial meltdown case. In June, Citigroup agreed to pay $2 billion, followed days later by JPMorgan's agreement to forfeit $2.2 billion.
CIBC had already paid the SEC $80 million to settle an investigation into wrongdoing connected to Enron. The $2.4 billion settlement marked the seventh such settlement with financial institutions connected to the Enron fiasco and the take so far is about $7 billion. Still remaining to settle are Barclays PLC, Credit Suisse First Boston, Merrill Lynch & Co., Toronto Dominion Bank, Royal Bank of Canada, Deutsche Bank AG and the Royal Bank of Scotland. Goldman Sachs & Co. also is named as a defendant for its role as an underwriter of Enron securities, as are a number of law firms and accountants. A number of CIBC executives also agreed to pay for their personal involvement in the massive fraud as have a myriad of other executives from Enron as well as financial, legal, and accounting firms. These settlements total in the tens of millions of dollars which is just peanuts, barely enough to pay for the lawyers' lunches.
The total amount of money still being sought is $47 billion but settlements will reduce that number significantly. A federal judge must now decide how to divvy up the dough. Some investors will have to wait for a year or more to get their money. Also waiting are Jeffrey Skilling, Richard Causey and Ken Lay, whose trials are due to start next January.
TAGS: Enron, bankruptcy, Ken Lay, Jeffrey Skilling, Richard Causey, fraud