Seeking to protect other U.S. workers from the retirement savings meltdown suffered by Enron Corp.(ENE.E) employees, two senators proposed legislation on Tuesday requiring more diversification in pension plans.
Senators Barbara Boxer and Jon Corzine also called for a thorough investigation of events leading to Enron's collapse, with Boxer declaring she thought someone should "go to jail" for the way Enron employees had been left in the lurch.
Thousands of Enron workers lost their jobs and much of their retirement savings when their retirement plans collapsed along with the former energy giant's stock price.
Boxer and Corzine said 67 percent of the assets in Enron 401(k) retirement plans were invested in Enron stock. They proposed limiting to 20 percent the investment an employee can have in any one stock in their individual 401(k) accounts.
"No one who gives investment advice would ever recommend someone being invested at 67 percent," Corzine, a New Jersey Democrat, told a news conference together with Boxer, a California Democrat.
"Frankly we have been generous with our bill putting down a 20 percent cap," Corzine said.
The proposal also calls for limiting to 90 days the time an employer can force an employee to hold a matching employer stock contribution in the employee's individual account plan.
It urges a reduction to 50 percent from 100 percent the tax deduction an employer can take on a matching contribution to an individual if that contribution is made in company stock.
With Congress soon to recess for the year, Boxer and Corzine's bill will likely have to wait until next year to progress. They also acknowledged they have yet to round up Republican support.
Boxer and Corzine spoke after tearful Enron workers told the Senate Commerce Committee how they had been left with nothing after the collapse of the company, which made the largest bankruptcy court filing in U.S. history on Dec. 2.
"When you look at the faces of these hardworking, loyal company employees who have nothing -- they are physically sick over what happened -- you would say the Justice Department ( news - web sites ) should go after these (Enron) people and they should be penalized," Boxer said.
Boxer charged earlier this month that the one-time energy giant Enron had broken existing pension law, a law she authored four years ago, when it prohibited employees from divesting company shares from their retirement plans.
She said she would continue urging the government to enforce that four-year-old law, and planned to write to the Justice Department about it, but added that law was no long enough.
"We're going to see if Enron broke the law. I personally think they broke many laws. I hope some of these people wind up in jail ...And that extends to people who audited the books here," she said.
"But unfortunately that law was watered down ...I want to do more," she said.