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Texas U.S. attorney office steps back from case

HOUSTON, Texas (CNN) -- Citing ties to people affected by the Enron bankruptcy and the appearance of a conflict of interest, the U.S. attorney's office in Houston recused itself Thursday from the Justice Department's criminal investigation of the energy giant.

U.S. Attorney Michael Shelby told CNNMONEY he and "several" other attorneys in his office in the Southern District of Texas had relatives who work or worked for Enron.

Shelby said that each of the staff's relatives suffered "varying degrees of loss" in recent months, including his own wife's brother, who is still employed at Enron North America but who has lost money in his 401(k) account.

The move came less than 24 hours after Justice Department officials had announced that the U.S. attorney's office in Houston would be one of three such offices working with federal prosecutors from the criminal division in Washington.

The offices in New York and San Francisco are still included in the task force being established.

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"The step has been taken after extensive consultation with legal counsel within the Department of Justice," the statement said.

It said one attorney from the office with no such ties might be assigned to the criminal division task force within the Justice Department.

"We believe the case should go forward in an aggressive way," Shelby said.

Shelby, a Bush White House appointee, has served as interim U.S. attorney for less than one month. He was appointed by a federal court to fill the post pending confirmation by the Senate.