Warren Says Banks Using Enron Commodity Model Face Risk
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Banks such as JPMorgan Chase & Co. may have adopted the model for commodity trading used by Enron Corp., adding “more and more risk” to the financial system, U.S. Senator Elizabeth Warren said.
JPMorgan, Morgan Stanley and Goldman Sachs Group Inc. are among lenders whose commodity trading is in jeopardy as the Federal Reserve reconsiders letting banks ship crude oil and run warehouses for industrial metals. Warren, a Massachusetts Democrat, spoke today at a Senate subcommittee hearing on bank ownership of metal and energy assets. Enron, once the world’s biggest trader of power and natural gas, collapsed in 2001.