Washington ? Major investment banks gave Enron Corp. multimillion-dollar loans that helped the now-bankrupt company disguise its true financial condition and, in some cases, they knew that Enron was using deceptive accounting for the loans, a Senate investigator testified Tuesday.

The bipartisan investigative subcommittee of the Senate Governmental Affairs Committee reviewed a million pages of documents, most of them subpoenaed, and interviewed dozens of witnesses from Enron and its Wall Street investment banks. It found some banks actively aided Enron in its dodgy accounting in return for big fees and favors in other deals, investigator Robert Roach said.

Representatives of Citigroup/Salomon Smith Barney are sworn in before the Senate Governmental Affairs Permanent Investigations Subcommittee on Capitol Hill. The panel is studying the role of financial institutions in Enron's collapse. From left are David Bushnell, Richard Caplan, Maureen Hendricks, and James Reilly.

“The evidence indicates that Enron would not have been able to engage in the extent of the accounting deceptions it did, involving billions of dollars, were it not for the active participation of major financial institutions willing to go along with and even expand upon Enron’s activities,” Roach said at the hearing.

There also is evidence that some of the banks allowed investors to rely on Enron financial statements they knew were misleading, Roach said.

The banks used complex financial transactions to boost Enron’s anemic cash flow to match its profit growth on paper, according to lawmakers.

Roach said that Citigroup Inc., the nation’s largest financial institution, and J.P. Morgan Chase & Co., also pitched the deals to other companies.

Citigroup “shopped” the Enron-style deals to 14 firms, selling it to at least three, Roach testified.

Houston-based Enron, which filed for bankruptcy in December, taking the investments of millions of people with it, used a web of thousands of off-balance-sheet partnerships to hide some $1 billion in debt from investors and federal regulators.

Officials of Citigroup and J.P. Morgan denied any wrongdoing, saying lenders shouldn’t be held responsible for how borrowers such as Enron recorded their loans.

Bank officials stressed at the hearing that Enron’s former auditor Arthur Andersen had reviewed the company’s accounting for the transactions and approved it.