Reps. Ray LaHood (R-IL) and John Shimkus (R-IL) have asked the heads of the Securities and Exchange Commission and the Federal Energy Regulatory Commission to take a closer look at the operations of AES Corp., which has seen its share price plummet as investors grow increasingly nervous about the company’s ability to handle, among other things, its large debt load. In the case of the SEC, the congressmen want that agency to review the activities of AES to see if federal securities laws may have been violated.

LaHood and Shimkus made their requests in Feb. 26 letters to FERC Chairman Pat Wood and Harvey Pitt, chairman of the SEC. The lawmakers are concerned about AES since the company’s Central Illinois Light Co. (CILCO) subsidiary provides power to their constituents.

“This isn’t a new concern for me,” Shimkus noted in an interview with NGI. “I had written a letter a couple of years ago on the initial merger or the purchase of CILCO by AES and wanted to make sure we did a good job of scrutinizing that,” he said. “Since then, I’ve had a chance to work with — or have tried to work with — AES on a coal mine issue and power issues, and they’re just a very difficult company to talk to,” Shimkus noted.

“Now, with the Enron issue, what we want to do is bring stability and strength and confidence to the market,” the Illinois lawmaker. “With the share price fluctuations, we would rather be ahead of the game than behind the game,” he added.

Along with the letters, LaHood and Shimkus included several recent newspaper articles outlining activities and financial difficulties currently being faced by AES. “These articles point out many items that are alarming to us and many of our constituents,” the lawmakers wrote to Wood and Pitt. “We feel a responsibility, as their elected representatives, to assure our constituents that they will continue to receive safe, reliable power.” AES acquired CILCO in October 1999.

In the letter to Wood, the lawmakers asked FERC to review the level and quality of service being provided by AES “and generally provide oversight as AES attempts to remain solvent.” LaHood and Shimkus asked Pitt to review the activities of AES “for possible violations of the federal securities laws.”

NGI asked Shimkus to elaborate on what was the impetus behind asking the SEC to examine AES for possible violations of federal securities laws. “I just want to make sure that there’s stability in the market … I’m not trying to imply that there’s any improprieties,” he said.

“It’s really just an attempt to let the SEC and the other folks, these regulatory agencies, do their jobs,” Shimkus told NGI. “We’re just asking them, if they have a list of companies that they’re looking at, that they add this to their list and maybe do a quick review.”

In the letter, the lawmakers told Wood and Pitt that because of the circumstances, “we are also asking that you expedite your review and report back to us, at least with a preliminary response, as soon as possible.”

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