Enron - Kenneth Lay

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Kenneth Lay Ken Lay’s vision for Enron was to lobby for deregulation in the energy industry. In 1985 Houston Natural Gas and InterNorth merged to form Enron. This merge created the longest pipeline network in the country. (That would give anyone a big ego) As chairman and chief executive of Huston Natural gas Ken Lay helped coordinate the deal and was named chairman and chief executive of Enron as a result. By early 1987, problems at Enron emerged. Despite the evidence of potential financial misconduct by top execs at Enron’s oil trading unit in Valhalla, N.Y., Lay allowed the execs to continue at the company. Months later, those same execs were found to have committed other improper acts that opened the company up to as much as a billion dollars in losses. As a result, the office doors in Valhalla were closed. Although this pales in comparison to the scandal 15 years later it does have eerie similarities. Prosecutors at the trial argued that the Valhalla episode should have been presented as evidence against Lay stating that he had a pattern of tolerating this behavior. In the early 1990’s, Congress (under heavy pressure, I mean lobbying, by Enron) passed legislation that began to open up electricity sales to marketers. This was the beginning of the end. Enron quickly dominates the energy market and adopts a new accounting method. The smartest guys in the room fooled us for a while but before long Enron was being blamed for massive blackouts and price hikes in California. In lieu of their pending demise Lay announces that Enron stock is an incredible deal and that the company was doing great. In October 2001, the Securities Exchange Commission opened an inquiry into Enron’s many limited partnerships. Lay continues to communicate lies to Enron employees as well as the general public. He says his executives are nothing but ethical. Less

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