Former Enron exec awaits sentencing
Houston, October 23:
Former Enron chief executive Jeffrey Skilling, who was convicted of massive fraud and conspiracy earlier this year, awaited sentencing here on Monday as one of the biggest corporate scandals in US history drew closer to its conclusion.
Skilling will learn his fate from US District Judge Simeon Lake without his co-defendant, Enron founder Kenneth Lay, who died of heart failure in July.
Lay’s conviction on 10 counts of fraud, conspiracy and banking violations was thrown out on Wednesday because he died before he could appeal the verdict. Skilling faces a maximum penalty of 185 years in jail after a jury found him guilty in May of 19 counts of conspiracy, fraud and insider trading.
Enron’s spectacular collapse in 2001, then the largest corporate bankruptcy in history with more than 40 billion dollars in outstanding debt, rattled energy and stock markets. Thousands lost their jobs and life savings.
“It was a watershed event and watershed case,” said David Berg, a trial lawyer and legal analyst in Houston who has followed the proceedings closely. “I’d rank it up there with Watergate in the way it shook public confidence.” While a raft of other business scandals followed, like Tyco, ImClone, Aldephia and Worldcom, it was Enron that became synonymous with corporate malfeasance.
And Skilling and Lay personified greed for hiding company losses and hyping the stock’s value while selling their own shares on the sly.
Legislators invoked their names to justify passage of the Sarbanes-Oxley Act, which aims to improve corporate governance by making executives and boards of public companies personally responsible for accounting statements.
The law’s provisions have been in place for two years and businesses complain that compliance is onerous and expensive.