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View Full Version : Greedy ENRON Bastards, Lay and Skilling, Guilty


Mr. Kotter
05-25-2006, 10:12 AM
http://money.cnn.com/2006/05/25/news/newsmakers/enron_verdict/index.htm?cnn=yes

:clap:

Skilling and Lay, Guilty
Ex-CEO and founder convicted on fraud and conspiracy charges in Enron case.

May 25, 2006: 11:46 AM EDT

HOUSTON (CNNMoney.com) - Enron former chief executive Jeffrey Skilling and founder Kenneth Lay were found guilty Thursday of conspiracy and fraud in the granddaddy of all corporate fraud cases. On the sixth day of deliberations, a jury of eight women and four men convicted the former executives of misleading the public about the true financial health of Enron, whose collapse in late 2001 symbolized the wave of corporate fraud that swept the United States early this decade.

Skilling was found guilty on 20 counts of conspiracy, fraud, false statements and insider trading. He was found not guilty on eight counts of insider trading.

Lay was found guilty on all six counts of conspiracy and fraud.
In a separate bench trial, Judge Sim Lake ruled Lay was guilty of four counts of fraud and false statements.

Both Lay and Skilling could face 20 to 30 years in prison, legal experts say.

The verdict is a major victory for the government and marks the end of one of the most scandalous chapters in the history of corporate America.

Houston-based Enron, once one of the hottest companies on Wall Street, imploded in a matter of months after Skilling abruptly resigned as CEO in August 2001. Lay, who was chairman at the time, postponed his retirement plans to return to the helm.

Enron's collapse marked the first of the high-profile corporate scandals that rocked the nation, followed by WorldCom, Global Crossing, Adelphia and Tyco. The wave of fraud led to passage of the Sarbanes-Oxley law that tightened oversight of how American companies are audited.


After a government investigation that took 4-1/2 years, prosecutors presented evidence that Lay and Skilling orchestrated a conspiracy to artificially inflate profits, hide millions in losses and misrepresent the true nature of the company's finances.

The long-awaited trial began Jan. 31 in Houston, despite repeated protests from defense attorneys calling for a change in venue.

The defense argued that it was impossible to get a fair trial in Houston - the epicenter of Enron's collapse. Enron's bankruptcy, the biggest in U.S. history when it was filed in December 2001, cost 4,000 employees their jobs and many of them their life savings. Investors lost billions.

Over 16 weeks, the government presented 22 witnesses, including former top executives, who testified that Skilling and Lay fostered a culture that put the company's image and stock price above everything else, at any cost.

Sixteen people pleaded guilty for crimes committed at the company, and five others, including four former Merrill Lynch employees, were found guilty at trial. Eight former Enron executives testified against Lay and Skilling, their former bosses.

But it was Enron's former finance chief, Andrew Fastow, who was the star witness for the government.

Fastow, who pleaded guilty to wire and securities fraud in 2004 in exchange for an expected 10-year sentence, testified that special partnerships were created to help the company hide millions of dollars in losses.

But defense lawyers dismissed the testimony of Fastow and other witnesses, saying that not only were Lay and Skilling innocent, but that no crimes were committed at Enron, except for the shady deals that enriched Fastow.

As for those other than Fastow who testified against Lay and Skilling, defense attorneys said they were strong-armed by the government and compelled to lie on the stand out of fear for themselves and their families.

In an attempt to explain away the company's aggressive accounting and the optimistic comments executives made to Wall Street, both Skilling and Lay testified during the trial.

But that yielded decidedly mixed results.

Skilling, known for his harsh attitude, came off in a mostly positive light, though he did lose his temper on the stand. But Lay's congenial reputation took a blow as he appeared confrontational and irritable at several points during his testimony.

:clap:

penchief
05-25-2006, 10:17 AM
I got goosebumps when I heard the verdict. Too bad nothing can be done to give 4000 people back their lives.

Those idiots on Fox News are trying to say that Lay probably would have gotten off if he hadn't testified. Said his performance on the stand cast him as an unsympathetic figure and everything went down hill from there.

Heh. I guess the White House Pravda will never give it up.

Mr. Kotter
05-25-2006, 10:25 AM
I got goosebumps when I heard the verdict. Too bad nothing can be done to give 4000 people back their lives.

Those idiots on Fox News are trying to say that Lay probably would have gotten off if he hadn't testified. Said his performance on the stand cast him as an unsympathetic figure and everything went down hill from there.

Heh. I guess the White House Pravda will never give it up.

Justice prevailed. With any luck, this will help with some of the civil cases that are pending too.

jAZ
05-25-2006, 10:37 AM
Justice prevailed. With any luck, this will help with some of the civil cases that are pending too.
Despite the natural attempts by these guys to hide their deeds. I wonder if justice will prevail within the WH?

Mr. Kotter
05-25-2006, 10:45 AM
Despite the natural attempts by these guys to hide their deeds. I wonder if justice will prevail within the WH?

Already want to connect it to the WH.....man, you are something else. :shake:

jAZ
05-25-2006, 10:45 AM
Moved from Kotter's Double Post...

I'm pretty sure these guys (Enron Execs) were involved in writing our current energy policy (and quite possibly or Iraq foreign policy). Though we won't know until the list is declassified. I'm sure that's not necessary, these folks are quite trustworthy.

patteeu
05-25-2006, 10:47 AM
How's that for an exclamation point at the end of the Clinton's era of Corporate Corruption? I feel kind of sorry for these guys because the things they were doing were probably not that unusual for their time. You can bet that Arthur Anderson was using similar accounting practices at some of their other client sites. That's the way the big accounting firms operate. These guys just had the misfortune of having their company go belly up.

patteeu
05-25-2006, 10:49 AM
Already want to connect it to the WH.....man, you are something else. :shake:

I return the favor with a reference to Clinton and thereby bring balance back to the universe. ;)

jAZ
05-25-2006, 10:49 AM
How's that for an exclamation point at the end of the Clinton's era of Corporate Corruption? I feel kind of sorry for these guys because the things they were doing were probably not that unusual for their time. You can bet that Arthur Anderson was using similar accounting practices at some of their other client sites. That's the way the big accounting firms operate. These guys just had the misfortune of having their company go belly up.
Wow.

ROFL

jAZ
05-25-2006, 10:50 AM
Already want to connect it to the WH.....man, you are something else. :shake:
No kidding... I wonder why?

Mr. Kotter
05-25-2006, 10:52 AM
How's that for an exclamation point at the end of the Clinton's era of Corporate Corruption? I feel kind of sorry for these guys because the things they were doing were probably not that unusual for their time. You can bet that Arthur Anderson was using similar accounting practices at some of their other client sites. That's the way the big accounting firms operate. These guys just had the misfortune of having their company go belly up.

I guess jAZ has already forgotten about the previous administration's shady dealings and campaign finance scandals that were covered-up involving the sale of arms to China......not to mention the "ties" of most administrations to similar "allegations."

banyon
05-25-2006, 11:03 AM
How's that for an exclamation point at the end of the Clinton's era of Corporate Corruption? I feel kind of sorry for these guys because the things they were doing were probably not that unusual for their time. You can bet that Arthur Anderson was using similar accounting practices at some of their other client sites. That's the way the big accounting firms operate. These guys just had the misfortune of having their company go belly up.

I don't think that their transgressions are limited to malfeasance by their accountants, as this post suggests.

patteeu
05-25-2006, 11:24 AM
I don't think that their transgressions are limited to malfeasance by their accountants, as this post suggests.

I wouldn't necessarily call it malfeasance. Before the high profile bankruptcies, I'd bet it was just standard bleeding edge accounting and I'd go further and guess that the government's regulators were aware of the practices. But I'll be the first to admit I don't have detailed knowledge of what was going on.

BucEyedPea
05-25-2006, 11:26 AM
No one woulda ever gotten hurt if the govt didn't force Enron to provide stock options for its employees, not to mention other bad policy that led to the Enron scandal. Meanwhile, the real criminals, politicals, continue to plunder the govt through using massive debt.

banyon
05-25-2006, 11:31 AM
How many people have seen the documentary :

Enron: the Smartest Guys in the Room (http://www.imdb.com/title/tt0413845/)

Messier
05-25-2006, 11:34 AM
How's that for an exclamation point at the end of the Clinton's era of Corporate Corruption? I feel kind of sorry for these guys because the things they were doing were probably not that unusual for their time. You can bet that Arthur Anderson was using similar accounting practices at some of their other client sites. That's the way the big accounting firms operate. These guys just had the misfortune of having their company go belly up.


Please tell me you're joking. Please tell me you know that Bush is told what to do by corporations and corporate interests. How are corporations more accountable now? That's a point of pride for conservatives isn't it? Yeah for making money and lots of it little guy be damned? Yay Wal-Mart! Boo welfare! It's the bleeding heart liberals that cry corporate corruption and feel for the lower class, right? That's their thing.

Pitt Gorilla
05-25-2006, 11:39 AM
I wouldn't necessarily call it malfeasance. Before the high profile bankruptcies, I'd bet it was just standard bleeding edge accounting and I'd go further and guess that the government's regulators were aware of the practices. But I'll be the first to admit I don't have detailed knowledge of what was going on.Wow, these are quite the accusations. Where did you get these ideas?

BucEyedPea
05-25-2006, 11:43 AM
My goodness, our govt cooks it's own books ALL the time, but it prosecutes civilians for doing the same? LOL!

jAZ
05-25-2006, 11:51 AM
I wouldn't necessarily call it malfeasance. Before the high profile bankruptcies, I'd bet it was just standard bleeding edge accounting and I'd go further and guess that the government's regulators were aware of the practices. But I'll be the first to admit I don't have detailed knowledge of what was going on.
It's a new thing (as far as I can tell) for you to start knowingly making commentary on a topic that you admittedly don't even have common knowledge about. What's with that?

And yes, you should watch Smartest Men In the Room. It's revealing and unsettling.

Mr. Kotter
05-25-2006, 12:32 PM
My goodness, our govt cooks it's own books ALL the time, but it prosecutes civilians for doing the same? LOL!

Please, save a little face by recognizing this goes well beyond what the "govt" does.....:spock:

Duck Dog
05-25-2006, 12:34 PM
Skilling and Lay make Michael Milken look like he rode the short bus.

Cochise
05-25-2006, 12:42 PM
How's that for an exclamation point at the end of the Clinton's era of Corporate Corruption? I feel kind of sorry for these guys because the things they were doing were probably not that unusual for their time. You can bet that Arthur Anderson was using similar accounting practices at some of their other client sites. That's the way the big accounting firms operate. These guys just had the misfortune of having their company go belly up.

I feel bad for the people whose 401k went in the tank, but how come nobody asks: How much less would they have been worth if not for the corruption?

Duck Dog
05-25-2006, 01:15 PM
I feel bad for the people whose 401k went in the tank, but how come nobody asks: How much less would they have been worth if not for the corruption?


Plus, who puts all their savings on one fund? Instead of losing all of it these folks should have only lost 1/3 or 25%. I'm not saying that's a good thing, but it's exactly why we are told to diversify.

BucEyedPea
05-25-2006, 01:36 PM
Please, save a little face by recognizing this goes well beyond what the "govt" does.....:spock:

I don't have to save face. That's my opinion.
One is just made legal and the other illegal.

Baby Lee
05-25-2006, 01:48 PM
I feel bad for the people whose 401k went in the tank, but how come nobody asks: How much less would they have been worth if not for the corruption?
In the case of the employees, because if you can't access it, you're not WORTH it. By the time they were allowed access, it could not have been worth less.
In the case of everyone else, because when the company perpetrates a fraud regarding earnings and gross worth, the activity of buying stock has transformed from investing to playing the lottery. The investor's WORTH was attached to an atom bomb, primed to detonate at any time.

Duck Dog
05-25-2006, 01:49 PM
I don't have to save face. That's my opinion.
One is just made legal and the other illegal.


I think what he's refering to is the blatent way Lay and Skilling organized the company to bilk millions and in return thousands lost their retirement accounts.

I suppose if you look at the way the government has accounted for social security you could make the connection.

BucEyedPea
05-25-2006, 01:56 PM
I think what he's refering to is the blatent way Lay and Skilling organized the company to bilk millions and in return thousands lost their retirement accounts.

I suppose if you look at the way the government has accounted for social security you could make the connection.


My point is that they're just as corrupt...regarding how they manage their books. And no one knows if millions of Americans will ever collect on SS either.

patteeu
05-25-2006, 02:27 PM
It's a new thing (as far as I can tell) for you to start knowingly making commentary on a topic that you admittedly don't even have common knowledge about. What's with that?

And yes, you should watch Smartest Men In the Room. It's revealing and unsettling.

You don't know the details of the Enron situation either. This thread would be empty if understanding the details of the charges against Enron and the arguments for both the prosecution and the defense were pre-requisites. If you think watching an agenda-driven movie has turned you into an informed observer then you are sadly mistaken.

BTW, I didn't admit that I don't have common knowledge about Enron, so not only is it not a new thing for me to admit commenting on such subjects, it's not a thing at all. I've read plenty of news accounts about the case although it's been a couple of years since I did much of that and I have almost no faith in the reporters to understand the subject on which they are reporting.

patteeu
05-25-2006, 02:28 PM
Wow, these are quite the accusations. Where did you get these ideas?

I wouldn't call them accusations. More like suspicions. I get them from working for one of Arthur Anderson's main competitors during the same time period (albeit not as an accountant). And just to be clear, I'm not saying Arthur Anderson was doing anything that the other major accounting companies wouldn't have done in the same position. I don't know exactly what AA advised them to do, but I do know that those companies during that time period were pushing the envelope of accounting practices. Sometimes the regulators would disallow some practices and they'd have to pull back, but until that happened, the accountants would often push the envelope in the gray areas. The economy was booming and since there was no harm, very few fouls were being called. But as soon as the economy started turning and some of the aggressive positions were exposed as vulnerable (i.e. voters started feeling pain), the government turned the finger of blame at the corporate executives and their accountants instead of admitting that they had been a part of the problem themselves. Like I said, these are suspicions, not specific accusations because I don't know enough of the details to actually make accusations.

banyon
05-25-2006, 02:47 PM
You don't know the details of the Enron situation either. This thread would be empty if understanding the details of the charges against Enron and the arguments for both the prosecution and the defense were pre-requisites. If you think watching an agenda-driven movie has turned you into an informed observer then you are sadly mistaken.

BTW, I didn't admit that I don't have common knowledge about Enron, so not only is it not a new thing for me to admit commenting on such subjects, it's not a thing at all. I've read plenty of news accounts about the case although it's been a couple of years since I did much of that and I have almost no faith in the reporters to understand the subject on which they are reporting.

The documentary is based on the book that was written by Bethany McClain, who broke the story for Fortune magazine at the outset of the scandal. She's hardly Michael Moore.

PunkinDrublic
05-25-2006, 03:27 PM
How many people have seen the documentary :

Enron: the Smartest Guys in the Room (http://www.imdb.com/title/tt0413845/)

I saw it about a month and a half ago. It was more interesting than I thought it would be. I didn't think it was possible to make those guys look like even bigger pieces of shit.

These guys deserve to be sent to a federal pound me in the ass prison.

the Talking Can
05-25-2006, 03:42 PM
yeah, it was just some funny accounting....could have happened to anybody....

Sybil
05-25-2006, 06:22 PM
Deja vu....

Ugly Duck
05-27-2006, 08:36 AM
No one woulda ever gotten hurt if the govt didn't force Enron to provide stock options for its employeesThe Big Blue state got hurt bigtime. California politicians ran crying to the Bush administration that energy prices were being manipulated. They got laughed out of Washington. After the California treasury was siphoned off into Texas, Bushron finally admitted that was in fact the case.

penchief
05-27-2006, 02:22 PM
The Big Blue state got hurt bigtime. California politicians ran crying to the Bush administration that energy prices were being manipulated. They got laughed out of Washington. After the California treasury was siphoned off into Texas, Bushron finally admitted that was in fact the case.

And that has always been one of their strategies. After the damage is already done what can anyone do to fix it? Kinda' like Iraq......sure, mistakes were made but now that we're there we gotta' finish the job, right? They count on that.

As long as their agenda is fulfilled they don't care what we think about them. They'll be laughing all the way to the bank while also altering our democracy to ensure they'll have the upper hand for a long time to come.

They couldn't give two shits if we know that they're a bunch of scamming no-good business suits posing as leaders. All they care about is turning back the clock to when greed ruled and the average joe had to accept ground rules set by the power-quo.