Whopper of the Week: Enron Spokeswoman Peggy Mahoney

Potemkin energy trading.

“We weren’t trying to mislead anyone.”

Enron Energy Services’ spokeswoman Peggy Mahoney, quoted by Jason Leopold of Dow Jones Newswires in the Feb. 7 Wall Street Journal. Mahoney was being asked about the incident described below.

“Some current and former employees of Enron Energy Services, the retail energy unit of Enron Corp., say the company asked them to pose as busy electricity and natural gas sales representatives one day in 1998 so the Enron unit could impress Wall Street analysts visiting its Houston headquarters.

“More than a dozen former and current Enron Energy Services staff who spoke to Dow Jones Newswires said Enron executives rushed about 75 employees, including secretaries and actual sales representatives, down to an empty trading floor on the sixth floor and told them to act as if they were trying to sell energy contracts to businesses over the phone.

“‘When we went down to the sixth floor, I remember we had to take the stairs so the analysts wouldn’t see us,’ said Kim Garcia, who at the time was an administrative assistant for Enron Energy Services and was laid off last December. ‘We brought some of our personal stuff, like pictures, to make it look like the area was lived in. There were a bunch of trading desks on the sixth floor, but the desks were totally empty. Some of the computers didn’t even work, so we worked off of our laptops. When the analysts arrived, we had to make believe we were on the phone buying and selling electricity and natural gas. The whole thing took like 10 minutes.’

“Penny Marksberrywho also worked as an Enron Energy Services administrative assistant in 1998 and was laid off last Decemberand two employees who still work at the unit also said they were told to act as if they were trying to sell contracts.

“‘They actually brought in computers and phones and they told us to act like we were typing or talking on the phone when the analysts were walking through,’ Ms. Marksberry said. ‘They told us it was very important for us to make a good impression and if the analysts saw that the operation was disorganized, they wouldn’t give the company a good rating.’ “

Same story in the Feb. 7 Wall Street Journal.

Discussion: Fairness compels Chatterbox to point out that Mahoney claims it was a handful of employees, not 75, who were told to move to the sixth floor for the analysts’ benefit and that the company didn’t ask anyone to pretend to be a trader or a sales representative. “They were told to just sit there,” she says. But if this wasn’t an attempt to mislead, why did Enron move the employees? “I don’t know why,” Mahoney says. But if she doesn’t know why, how can she know the purpose wasn’t to deceive?

Mahoney would do well to emulate former Enron Chief Executive Jeffrey K. Skilling, who managed yesterday to get through his highly implausible testimony protesting similar ignorance about much weightier matters without committing any obvious perjury. Well done, Jeff!

Got a whopper? Send it to To be considered, an entry must be an unambiguously false statement paired with an unambiguous refutation, and both must be derived from some appropriately reliable public source. Preference will be given to newspapers and other documents that Chatterbox can link to online.

Whopper Archive:
Jan. 31, 2002: Monsanto
Jan. 24, 2002: Linda Chavez
Jan. 17, 2002: George W. Bush
Jan. 10, 2002: Simon & Schuster
Jan. 4, 2002: The Associated Press

(Click  here  to access the Whopper Archive for 2001.)