March 27, 2002

Andersen's Chief Quits In Bid to Rescue the Firm Joseph F. Berardino announced that he would step down as chief executive of Arthur Andersen in an effort to save the firm, which has been indicted for shredding documents related to its audit of Enron. His announcement comes after Paul A. Volcker, the former Federal Reserve chairman who heads a special oversight committee that was brought in to reform the firm, proposed a management shake-up at Andersen. Lawyers said neither move would lead the Justice Department to drop its criminal charge against the firm. [Page A1.] Network Associates Abandons Deal Shares in Network Associates, the computer security company, tumbled 11 percent, to $22.23, after it disclosed that federal regulators had begun a formal investigation into its accounting practices during 2000. The inquiry and falling stock price caused Network Associates to withdraw, at least for now, its $248 million offer to buy out its former spinoff, McAfee.com. That news sent shares of McAfee.com down 16 percent. Market Place. [C8.]

E-mail messages released by Congressional investigators show Enron Corp executives pressed UBS Paine Webber to take action against broker Chung Wu who advised some of Enron employees to sell their shares in August and was fired by brokerage firm within hours of complaint; Wu sent message to clients early on Aug 21 warning that Enron's 'financial situation is deteriorating' and that they should 'take some money off the table'; that afternoon, Enron executive in charge of its stock option program sent stern message to Paine Webber executives, including Houston branch office manager, to handle situation; PaineWebber fired Wu less than three hours later; that evening firm retracted Wu's assessment of Enron's stock--then about $36--by sending his clients optimistic report that Enron was 'likely heading higher than lower from her on out'; few months later, stock was worthless, and company was in bankruptcy court; day Wu was fired was day Enron's chairman Kenneth L Lay was shedding his own shares and talking up stock; message complaining to PaineWebber about Wu was sent by Aaron Brown, Enron official who PaineWebber says helped oversee stock option program; Rep Henry A Waxman says Enron's conduct regarding PaineWebber appears to be latest in series of indefensible actions; photo (M)

Brascan Corp offers to buy 30 percent of Trilon Financial Corp that it does not already own for 776 million Canadian dollars ($490 million) in cash and stock; Trilon will change its name to Brascan Financial Corp; Brascan owns 50 percent of Brookfield Properties Corp (S)

BAE Systems says John Weston will resign as chief executive immediately; chief operating officer Michael Turner will succeed him (S)

Palestinian leader Yasir Arafat says he will not attend Arab League summit meeting in Beirut after Israeli Prime Min Ariel Sharon says he wants right to bar him from returning to West Bank; decision is setback for Bush administration; casts doubt on Saudi peace plan; efforts of United States envoy Gen Anthony C Zinni to mediate Israeli-Palestinian cease-fire also seems stalled; suspicious vehicle halted by Israeli security forces explodes, killing both men inside, before it can reach apparent target, crowded Jerusalem shopping mall; two members of unarmed international monitoring force are ambushed and shot dead, near Hebron; survivor says uniformed Palestinian opened fire on them; security in Israel is extraordinary in advance of Passover; photo (M)