Metaphors & Images

Hope In My World


Some days I actually do see some hope for our world!

See this little news flash for instance.
Sources: Lay Indicted in Enron’s Collapse

2 hours ago

By KRISTEN HAYS, AP Business Writer

HOUSTON – Kenneth Lay, the founder and former chairman and CEO of Enron Corp. who says he committed no crimes at the scandal-ridden energy company, has been indicted on criminal charges, sources told The Associated Press.

The highly anticipated action came Wednesday, two and a half years into a methodical investigation that has produced charges against some of Lay’s once most highly trusted lieutenants, including his hand-picked protege, former CEO Jeffrey Skilling.

“I have done nothing wrong, and the indictment is not justified,” Lay, 62, said in a statement Wednesday after learning of the indictment. The indictment was to be unsealed after Lay surrenders to the FBI early Thursday.

Prosecutors from the Justice Department’s Enron Task Force presented an indictment to U.S. Magistrate Judge Mary Milloy in Houston on Wednesday, and at their request she sealed both the indictment and an arrest warrant, the sources said. The specific charges remained under seal.

A hearing before Milloy was scheduled for 11:30 a.m. CDT Thursday. Lay’s lawyer, Michael Ramsey, didn’t immediately return calls for comment.

The Securities and Exchange Commission also was expected to bring civil fraud charges against Lay on Thursday, including making false and misleading statements and insider trading, a person familiar with the case said, speaking on condition of anonymity.

Prosecutors have aggressively pursued the one-time celebrity CEO and friend and contributor to President Bush who led Enron’s rise to No. 7 in the Fortune 500 and resigned within weeks of its stunning failure. Lay is the 30th and highest-profile individual charged.

Skilling succeeded Lay as CEO in February 2001 and resigned abruptly six months later, just weeks before the scandal broke. He was indicted in February on nearly three dozen counts of fraud and other crimes.

Waiting to testify for the prosecution is former finance chief Andrew Fastow, who pleaded guilty to two conspiracy counts in January. Fastow admitted to orchestrating partnerships and financial schemes to hide Enron debt and inflate profits while pocketing millions of dollars for himself.

Enron’s collapse led a series of corporate scandals that prompted Congress’ passage of sweeping reforms to securities laws with the Sarbanes-Oxley Act two years ago. Thousands of Enron’s workers lost their jobs, and the stock fell from a high of $90 in August 2000 to just pennies, wiping out many workers’ retirement savings.

The charges against Skilling and former top accountant Richard Causey _ who was indicted a week after Fastow pleaded guilty _ target actions over several years leading up to Enron’s collapse. But allegations against Lay were expected to focus on his actions after he resumed the role of CEO upon Skilling’s abrupt resignation in August 2001, the sources said.

Days after Skilling’s resignation, Lay met privately with Sherron Watkins, then an executive on Fastow’s staff, who had sent him a lengthy memo warning of impending doom from Fastow’s myriad schemes to hide debt and inflate profits.

But Lay told The New York Times last month that he didn’t believe the company had serious problems and trusted other senior managers _ including Fastow and Causey _ when they reassured him that all was fine.

Skilling and Causey are awaiting trial on charges of conspiracy, fraud and insider trading. Both pleaded innocent and are free on bond.

___

AP Business Writer Marcy Gordon in Washington

I really never expected this one to even get this far.

Advertisements
This entry was published on July 8, 2004 at 2:52 am and is filed under Uncategorized. Bookmark the permalink. Follow any comments here with the RSS feed for this post.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: