Employee Trading

Given the proliferation of new products and the potential of Enron Net Works
to continue this trend, I am soliciting guidance as to the proper
administration of the Risk Management Policy regarding employee trading.

The following is the verbatim language from the Policy:

"Section VII. Miscellaneous
Employee Trading. No employee may engage in the trading of any Position
for the benefit of any party other than an Enron Company (whether for theri
own account of thr the account of any third party) where such Position
relates to (i) any financial instrument, security, financial asset or
liability whch falls within such employee's responsibility at an Enron
Compay or (ii) any other commodity included in any Commodity Group."

Administration of this policy has been limited to the efforts of Mark Taylor
and Tana Jones in the Legal Department primarily consisting of employees
"confessing" to trading certain products. In the past, if the product has
been one that Enron does not trade, the employee is told that it is ok. If
it is a product that we do trade, then they are informed to comply with
policy. Restrictions on the trading of financial instruments, such as
equities, interest rates and foriegn exchange have been limited to those that
are currently managing those books for an Enron Company or those who might
have access to information that was not in the public domain.

Generally, we have found that people have traded yen, S&P futures, metals and
agricultural products. Now that we have authorized the trading of a wide
variety of agricultural products and metals, we may need to advise employees
not to trade them (immediately, soon, never???). We may also consider
changing the policy or altering our enforcement methods.

Please advise your guidance as to how to proceed.

Ted