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University of Toronto Scarborough
Management (MGS)
Konstantine Zakzanis

At the time it was seen as wildly successful Which is why Fastow created LJM2 which in turn created the RaptorsLJM2Raptorsgetting capital for Enron Assets BG into LJM2RaptorsDiagram Map Make this a slide FastowBOD approved risk accounting audit BODdidnt think of investors great risk of loss Niccolo 70 Billion lieChewco Limited liability partnership created in Nov 1997 to buy CalPERS ownership in JEDI without needing to have Enron report losses from JEDI on its financial statements Enron wanted to keep JEDI afloat but needed an outside partner to have at least a 3 stake in the company or it would be consolidated Chewco was a Special Purpose Entity SPE and would need to meet 3 criteria to keep JEDI in nonconsolidation 1 Continuously invest at least 3 of the SPEs assets 2 Exercise control and assume risk of the SPE 3 Provide real economic benefits to EnronFastow wanted to be appointed manager but Enrons legal team advised against it Michael Kopperwho worked for Fastow but this fact was only known to Jeffrey Skilling on the BoDwas appointed manager of Chewco In NovDec of 1997 Enron and Kopper created a new financial structure for Chewco 1 240 million unsecured loan from Barclays which Enron would guarantee This was funded through Enron shares
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