NEWS RELEASE
Committee on Energy and Commerce Democrats
Congressman John D. Dingell, Ranking Member

GAO COMMITS TO REPORT TO DINGELL, MARKEY BY
JUNE 17, 2005 ON IMPACT OF LAX
SEC ENFORCEMENT OF PUHCA

Washington, D.C. – Rep. John D. Dingell (D-Mich), Ranking Member of the House Committee on Energy and Commerce, today released a commitment letter dated January 5, 2005, from the Government Accountability Office (GAO) agreeing to submit a report by June 17, 2005 on the findings of GAO’s in-depth review of the Securities and Exchange Commission’s (SEC’s) administration and enforcement of the Public Utility Holding Company Act of 1935 (PUHCA). The work was requested by Reps. Dingell and Edward J. Markey (D-Mass) in letters dated April 21, 2004 and August 18, 2004, in response to various troubling events, including Enron’s collapse and the manipulation of Western markets. The Committee on Energy and Commerce has jurisdiction over national energy policy generally, including PUHCA.

GAO’s study will assess:

(1) the extent to which SEC’s Office of Public Utility Regulation (OPUR) reviews registered holding companies and the results of the reviews;

(2) the extent to which OPUR reviews claims of exemption--filed as either self-certifications or applications for SEC order and the results of the reviews;

(3) OPUR’s process for issuing no-action letters; and

(4) how OPUR determines whether companies have a controlling influence in public utilities or public utility holding companies.

“Two years after Enron went bankrupt and well after that company had taken advantage of improper exempt status, the SEC in December 2003 issued an opinion denying Enron’s application for an exemption from PUHCA. Closing the barn door after the horses have fled is a futile act. Public-utility holding companies and their subsidiary companies are affected with a national public interest, and consumers and investors are harmed by the lack of effective public regulation to prevent abuses similar to those that gave rise to the enactment of PUHCA. In that vein, I have serious concerns with the inclusion of PUHCA repeal in the comprehensive energy legislation that the Republican Leadership has indicated it will soon bring before the House,” said Dingell.

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