Thanks for the update, Walt.  One option we were considering was a "share the 
pain" settlement with Dreyfus, whereby they would let us buy out of the 
remaining position at a steep discount (to acknowledge their contributory 
negligence in this matter).  Has there been any additional headway in this 
area?  I'm on vacation and haven't heard anything on this.  Weren't we going 
to send a V&E litigator to visit Dreyfus' general counsel? If we commence 
legal proceedings against Dreyfus, things will become costly and contentious 
between us. Information will come slowly and grudgingly.  We have copies of 
some of their internal notes which indicate that they knew---or should have 
known---that something wasn't quite right with Todoroff's situation.  Before 
we start filing discovery motions, we should exhaust the possibility of 
meeting with their general counsel to see if a quick "business" settlement 
can be obtained.  Please advise. Thanks.  SWD


WALT 
ZIMMERMAN        
03/16/2000 11:47 AM

To: Dana Gibbs/Houston/Eott@Eott, Lori Maddox/Houston/Eott@Eott, Susan 
Ralph/Houston/Eott@Eott
cc: Michael Burke/Houston/Eott@Eott, Steve Duffy/Houston/Eott@Eott, Stanley 
Horton/Corp/Enron@Enron 

Subject: Todoroff Prosecution--CONFIDENTIAL/SUBJECT TO ATTORNEY-CLIENT 
PRIVILEGE

Earlier this week, I spoke with Bill Moore (the chief prosecutor in the 
Harris County District Attorney's Special Crimes Unit) regarding the 
above-referenced matter.  Mr. Moore acknowledged receiving the investigative 
materials that we submitted last week, and he indicated that his office is 
commencing its review of those materials.  I emphasized to Mr. Moore the 
desire of EOTT's management to have this case aggressively prosecuted.  Mr. 
Moore acknowledged that the aggressive prosecution of this matter would send 
a strong message to other traders who might consider dishonest acts, and he 
assured me that his office would vigorously pursue this matter.  Based upon 
some statements made by Mr. Moore during our discussion, it was obvious that 
he recalled much of the presentation from our initial meeting.  I will call 
Mr. Moore again tomorrow afternoon to get an update on the progress of this 
matter.

We are also attempting to obtain from Louis Dreyfus tape recordings of 
Todoroff's conversations with them regarding the series of deals that we are 
describing as "The Second Transaction."  If Louis Dreyfus does not 
voluntarily provide us with copies of those tapes (or if they assert that 
tapes do not exist), the next step will be to consider filing a lawsuit or 
seeking a bill of discovery in order to obtain the tapes.  Based upon some 
notes we have received from a contract administrator at Louis Dreyfus, it 
appears that Louis Dreyfus also suspected or knew that something was amiss 
with The Second Transaction.  Assuming that Todoroff's conversations with 
Louis Dreyfus were taped, the tapes should tell us whether Todoroff had a 
conspirator at Louis Dreyfus who assisted him in his scheme to defraud EOTT.

If Louis Dreyfus does not voluntarily produce tape recordings of its 
conversations with Todoroff, we will need some guidance from Enron as to how 
aggressive we should be in attempting to obtain the tapes.