Enron chairman Kenneth Lay gave list of favored names to White House; Bush named two as energy regulators

WASHINGTON -- A few months after the White House got a list of recommended candidates from former Enron Chairman Kenneth Lay, a friend and backer of President Bush, two of them were appointed to a federal energy commission.

Lay gave the list of names to Clay Johnson, Bush's personnel director, White House spokeswoman Anne Womack said Thursday. Among the eight or so names were Pat Wood, now chairman of the Federal Energy Regulatory Commission, and Nora Brownell, a member of the commission.

"It was one of many, many recommendations that he (Johnson) received" from industry executives, members of Congress and state officials, Womack said in an interview.

Disclosure of Lay's recommendations to the White House last spring comes as congressional panels investigate the relationship between Houston-based Enron Corp., which filed for bankruptcy Dec. 2, and the Bush administration.

The Justice Department and the Securities and Exchange Commission are investigating Enron's complex accounting and what role its auditor, Arthur Andersen, played in the Houston-based company's collapse. Andersen has acknowledged destroying Enron-related documents.

A senator leading an investigation said Thursday that Enron had not cooperated in providing important information on the complex web of partnerships used by the company to conceal massive debts. The company's attorney said it doesn't have the documents sought.

As head of a major campaign donor, Enron, wielding significant influence in Washington, Lay enjoyed access to top government officials of both parties. The White House has acknowledged that Lay met once privately last year with Vice President Dick Cheney, who headed a task force that formulated the administration's national energy policy.

Lay disclosed the existence of the list of Enron favorites in an interview being broadcast Friday on PBS' "NOW with Bill Moyers."

"I brought a list, we certainly presented a list. ... As I recall, I signed a letter which in fact had some recommendations as to people that we thought would be good (FERC) commissioners," Lay said in the interview, which was taped in May but never aired.

Bush, as Texas governor, had appointed Wood in 1995 as head of the state's Public Utilities Commission. Wood has been an advocate of market-oriented regulation of utilities, a position espoused by Enron, a big, aggressive energy trader that had become a favorite of Wall Street.

Bush appointed Wood as FERC chairman in August, replacing Curt Hebert.

Hebert said in the PBS interview that Lay "has asked me to take certain positions but I've had those conversations with Ken Lay for a long time. And have disagreed with him for a long time."

Brownell, a member of Pennsylvania's Public Utility Commission, was nominated by Bush in March. During her time on the state commission, Brownell helped oversee Pennsylvania's electricity deregulation.

Lay will be the star witness next week as a blizzard of hearings by several congressional panels put the Enron collapse under intense public scrutiny.

Enron officials "just simply have not cooperated" in providing the documents sought, said Sen. Byron Dorgan, D-N.D., chairman of a Senate Commerce subcommittee. "We again renew our request."