J.P. Morgan Chase Bank, and Offshore Special Purpose
by Janet Tavakoli
Enron declared bankruptcy on December 2, 2001, J.P. Morgan
Chase Bank ("J.P. Morgan") had $965 million in
losses from payments due on oil and gas contracts with
were hedged with surety bonds. The surety bonds were advance
payment bonds that guaranteed Enron’s credit risk
on pre-paid oil and gas forward delivery contracts.
J.P. Morgan lost a pre-trial bid in the Southern District
of New York to get immediate payment from the insurance
companies. As reported by Bloomberg news, in an affidavit
filed in New York District Court, David Wilson outlined
the gist of Enron’s transactions, and this article
is a reconstruction of one of the transactions based on
TSF's interpretation of
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