Risk Management

Barclays Free of Enron-Related Claims

Shareholders of the energy giant had charged that the British bank helped Enron hide its debts.
Stephen TaubJuly 21, 2006

The U.S. District Court for the Southern District of Texas has dismissed claims against Barclays Plc in the Enron class action, the bank reported.

Unless the court’s decision is successfully challenged by the plaintiffs, it marks the end of the so-called Newby litigation for Barclays, the U.K.-based financial giant added in a regulatory filing.

In a sweeping class-action suit against Enron, its banks, and several former top executives, Enron shareholders alleged they lost $40 billion when Enron collapsed, according to Reuters. The shareholders charged that Barclays and a number of other banks helped Enron hide its debts.

Some of the other banks have already agreed to pay billions of dollars to settle claims. Royal Bank of Scotland is reportedly close to reaching a settlement with Enron investors, according to Reuters.

Separately, three former executives at Greenwich NatWest, a unit of RBS, were recently extradited to the United States to face fraud charges related to the Enron debacle. Their trial is scheduled to begin later this year.

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