The Securities and Exchange Commission objected Friday to bankrupt Enron paying its interim chief executive $1.3 million a year and letting him hire as many as 15 associates.

The SEC, which is investigating Enron's collapse, said in a filing in federal bankruptcy court that many of the terms of Enron's agreement with company turnaround specialist Stephen Cooper "are overreaching and are inappropriate."

The Justice Department also is investigating Enron and its longtime auditor, the Arthur Andersen accounting firm. A Justice official indicated Friday that government lawyers were in negotiations with Andersen. The official provided no details.

Andersen in January acknowledged massive shredding by its employees of Enron-related documents and later fired its lead Enron auditor for the document destruction.

The SEC, referring to Enron's agreement with Cooper, said: "These terms cast doubt on the fairness of Enron's handling of its bankruptcy case and on the bankruptcy process as a whole." The agency submitted the brief to the U.S. Bankruptcy Court in New York, where Enron filed for protection from creditors on Dec. 2.

An attorney representing Enron said a new agreement with Cooper was filed with the court Friday that addresses some of the SEC's objections but retains the $1.3 million salary and still allows him to hire up to 15 associates at an annual salary of $864,000 each.

Under the proposed new agreement, Cooper no longer would be automatically entitled to a $5 million fee if Enron successfully reorganizes or liquidates, said Martin Bienenstock, the outside attorney representing Enron in its bankruptcy proceeding. Cooper, who was hired by Enron's board on Jan. 29, also would assume legal responsibility to the shareholders.

A hearing is scheduled for the first week of April.

Cooper said this week that resurrecting what remains of the energy-trading company will be both difficult and different from any previous case, but not impossible.

Former Enron chief executive Jeffrey Skilling, meanwhile, lashed back at lawmakers who have challenged his recent testimony to Congress, with his lawyer saying his statements were truthful and calling their inquiry "accusatorial and prosecutorial."

Leaders of the House Energy and Commerce Committee had asked Skilling to clarify statements he made Feb. 7 regarding his involvement in questionable financial transactions. Skilling said he did not recall being involved in approving transactions related to the so-called Raptors, fragile financial structures that kept more than $1 billion in debt off Enron's books and eventually brought the company down.

The Raptors' main financial assets improperly consisted of Enron's own stock, which plummeted last year.

Skilling's attorney, Bruce Hiler, told the lawmakers in a letter Friday that a review of notes of company investigators' interviews with several Enron executives showed that they corroborated Skilling's testimony rather than contradicted it.

"There is not a scintilla of evidence supporting such questioning or accusations," Hiler said, referring to the lawmakers challenging the veracity of Skilling's testimony. Their questioning of him at the hearing "demonstrates that the inquiry is designed to be both accusatorial and prosecutorial," he wrote.