---------------------- Forwarded by Carol St Clair/HOU/ECT on 03/17/2000 
12:57 PM ---------------------------


David Forster
03/17/2000 10:42 AM
To: Bob Shults/HOU/ECT@ECT
cc: Per Sekse/NY/ECT@ECT, Carol St Clair/HOU/ECT@ECT 
Subject: Re: One Password - multiple legal entities for Hedge Funds  

One system-simple solution would be:

1) Trade with the Manager Online
2) Manager calls Enron trader and completes a set of trades OTC, which have 
the effect of reversing the original trade and then reallocating among the 
subentities.

This would not involve any system changes or any legal approvals.

Dave


   
	Enron North America Corp.
	
	From:  Bob Shults                           03/17/2000 04:00 PM
	

To: Per Sekse/NY/ECT@ECT
cc: David Forster/HOU/ECT@ECT, Carol St Clair/HOU/ECT@ECT 

Subject: Re: One Password - multiple legal entities for Hedge Funds  

Given a trade on EnronOnline is a contractual agreement between the legal 
entity (established by the USERID) and Enron, we will essentially need to 
assign the trade from that legal entity to the allocated group of entities.  
My understanding is that we will need to have an agreement which allows us to 
assign the trades.  Given this is a legal question, either Carol St Clair or 
Mark Taylor will need to address this.  

Dave can you want to discuss with Per and legal?


To: Bob Shults/HOU/ECT@ECT
cc: David Forster/HOU/ECT@ECT 
Subject: Re: One Password - multiple legal entities for Hedge Funds  

Do we need the agreement or does the client need to show us that they have 
the authority to do the allocation? It seems to me that the fund manager has 
authorization in place to manage each fund and transact as he sees fit. We're 
acting on this authority when they trade over the phone without a power of 
attorney type agreement covering us. In other words, I would expect that the 
documentation we need to have is in the funds hands already and we need only 
review it to confirm thay have authorization to allocate trades.

The only time I know this does not apply is when the Hedge Fund needs to do a 
reallocation to rebalance the funds they manage. We went through this with 
Tiger in January. They need to have us execute trades with each fund to 
rebalance the positions. This is caused by fund flows into/out of the 
individual accounts at specific times of the year. It means we buy from one 
fund and sell to another, leaving our net trading position unchanged, but 
adjusting our individual position with each fund.  The fund manager can not 
do the trades himself directly between the accounts he manages, but he can 
transact with Enron for each fund and achieve the same efffect. Does this 
make sense.

Perhaps we should schedule a time to discuss this further. Today is not good 
for me, but any time next week.

Thanks.
Per