As Enron was free-falling towards bankruptcy last autumn, one big US pension fund under the joint trusteeship of President George W Bush's brother Jeb kept buying shares in the Houston energy-trading company - which resulted in huge losses at the fund.
The Florida state pension fund lost a total of $335 million (€388 million) when Enron went bankrupt on December 2nd, making it far and away the biggest loser among US state funds invested in the Houston company.
The Florida fund bought $7.1 million of stock in October after Enron announced more than $1 billion in losses, $16.1 million after Enron came under investigation in the same month, and $11.7 million in November, after Enron admitted overstating profits.
Jeb Bush, Florida's Republican Governor, is one of the three trustees of the pension fund. He did not give any direct order to buy Enron funds, according to fund managers.
However, the huge damage to the pension fund is raising new questions about Bush family ties with Enron, and about the all-pervasive influence of the now-bankrupt Texas corporation in state and national politics.
Like the President, Governor Bush was a recipient of Enron campaign donations. Two weeks ago, he travelled to Houston for a fund-raiser in the home of a former Enron executive. Also, one of the top executives of the pension fund's leading money manager, Alliance Capital Management of New York, is a member of the board of Enron.
Alliance Capital Management has argued that from a money manager's perspective, buying shares in the energy giant at seemingly bargain prices looked like a worthwhile gamble. Florida is suing Enron and has fired Alliance. New York City's pension fund, which lost $109 million, has joined in the lawsuit.
Public suspicions about the Bush administration's ties with Enron are growing, according to a poll in yesterday's New York Times.
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