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Enron Trial Overview


Former Enron CEO Jeffrey Skilling, 52: convicted of 19 charges of fraud, conspiracy, and insider trading. Kenneth Lay, 63: convicted of six counts of conspiracy and fraud.



VERDICT

The 17-week trial came to a conclusion on May 25 with jurors handing down guilty verdicts:

  • Lay was convicted on all six counts
  • Skilling was convicted on 19 of the 28 counts

In a separate, non-jury trial presided over by Judge Lake, Lay was also convicted of bank fraud and making false statements to banks.

For further information:

 

OVERVIEW

  • Week 1
  • Week 2
  • Week 3
  • Week 4
  • Week 5
  • Week 6
  • Week 7
  • Week 8
  • Week 9
  • Week 10
  • Week 11
  • Week 12
  • Week 13
  • Week 14
  • Week 15
  • Week 16
  • Week 17 
  • Verdict
  •  


    WEEK 1

    Monday, Jan. 30

    The Houston-based trial started with jury selection. U.S. District Judge Sim Lake instructed the jury of eight women and four men not to talk about the case during their service, and not to read, watch or listen to news reports covering the trial. Lake told the jurors he did not expect them to "blot out" what they had already heard, but to decide based on evidence.

    Tuesday, Jan. 31

    Kicking off the long-awaited criminal trial of Skilling and CEO, federal prosecutor John Hueston told jurors that the Enron trial "is not about accounting. It is about lies and choices." He said Skilling and Lay "chose to lie" about the company's finances in order to maintain its image of success.

    In his counter, Skilling's head lawyer, Daniel Petrocelli, said his client did not take part in a conspiracy, and that when he resigned in 2001 for personal reasons he believed the company was in sound financial position. The defense argued that many of the former executives who had entered plea agreements were not necessarily guilty of breaking the law and were coerced into plea agreements to avoid the cost of fighting the government.

    Petrocelli said Skilling would testify in his trial.

    Wednesday, Feb. 1

    Prosecution witness Mark Koenig, former executive vice president of investor relations, said executives Jeffrey Skilling and Kenneth Lay were closely involved in company operations and sought to boost Enron's stock price to impress Wall Street.

    Koenig testified that in July 2000, the quarterly earnings were raised from 32 cents per share to 34 cents per share in order to beat Wall Street estimates by 2 cents. He did not say Skilling or Lay ordered a fraudulent charge. He said he discussed the change with then-president Skilling, who approved changes to financial figures.

    Koenig, who pleaded guilty to aiding and abetting securities fraud, is one of 16 former Enron executives who have pleaded guilty since Enron's collapse. His career at Enron spanned 17 years.

    Thursday, Feb. 2

    Continuing his testimony from Wednesday, Enron's former head of investor relations, Mark Koenig, testified that former CEO Jeffrey Skilling in 2001 gave Wall Street analysts misleading information about the earnings of a business unit. According to Koenig, Enron losses amounting to $726 million in first-half losses were not disclosed in conference calls. The losses had been moved into and absorbed by the Enron wholesale division.

    When asked by the prosecution if he was coerced into this plea agreement in 2004, Koenig said, "I pled guilty because I am guilty."

    WEEK 2

    Monday, Feb. 6

    Prosecution witness Mark Koenig continued his testimony. According to Koenig, aggressive accounting practices were discussed at a Sept. 5-6, 2001, meeting, after Skilling had stepped down from his CEO role. Koenig said former accounting chief Richard Causey and former CFO Andrew Fastow defended the accounting, while other officials at the meeting challenged the accounting. Said Koenig, who was present at the meeting: "Mr. Causey's and Mr. Fastow's point was the accounting was aggressive, but it benefited a lot of the people at the table."

    In cross-examination, defense lawyer Daniel Petrocelli attacked Koenig's credibility. Petrocelli accused the witness of trying to avoid jail time by pleasing prosecutors, and trying to protect $5 million he earned while at Enron. Koenig told jurors he would "love" to spend zero time in jail and to keep the $5 million. Later, Koenig broke down in tears when the defense questioned him about how old his children were when he pleaded guilty in August 2004. After a 15-minute recess, Koenig returned to the stand and told the jurors, "If I can answer your earlier question, two of my children are in college and one is in high school. Entering this guilty plea, its not hard to tell them that. I'm over the big fear."

    Tuesday, Feb. 7

    Mark Koenig took the stand again, for the fourth day, and told juors that he believed the top Enron executives were determined to meet or beat Wall Street earnings expectations and made or knew of overnight changes to suspect estimates.

    Still, Koenig stopped short of saying that he knew unequivocally that his former boss knowingly did anything improper.

    Wednesday, Feb. 8

    Mark Koenig remained on the stand for a fifth day and held firm to his earlier statements that Skilling and Lay deliberately hid losses and doctored earnings. The cross examination of Koenig included the contents of a video of an internal employee meeting and audio tapes of past Enron conference calls with analysts.

    Thursday, Feb. 9

    Mark Koenig spent a sixth day on the stand and continued to defend his guilty plea. Lay's lead defense lawyer, Michael Ramsey, attempted to shift the focus of the trial on former finance chief Andrew Fastow. Judge Lake, however, sustained the prosecution's objections.

    WEEK 3

    Monday, Feb. 13

    In the start of the third week of the trial, Mark Koenig testified for the prosecution for his seventh day. Jurors heard a conference call that occurred just six weeks before Enron's implosion in which Kenneth Lay disclosed $600 million in quarterly losses and a $1.2 billion reduction in investors equity. The defense sparred with Koenig by asking if the disclosed losses were a surprise.

    "These write-downs were not a surprise, were they?" asked Lay's lawyer Michael Ramsey.

    "I don't remember many people who were not surprised at the size of the loss and the nature of the loss," Koenig replied.

    Tuesday, Feb. 14

    Former Enron executive Kenneth Rice, who once led Enron's broadband business, took the stand Tuesday as the government's second witness. A longtime friend of Skilling's, Rice said he had two-weeks prior notice of Skilling's August 2001 resignation. Rice admitted he sold stock as soon as he learned of Skilling's planned departure.

    Rice also testified that Skilling understood the business intimately, was "hands on," and urged executives to mislead Wall Street about the company's losses. "Mr. Skilling would simply say, in fact he did say, 'This is what the number's going to be,'" said Rice. "So we'd walk away and say 'All right, we're going to try and hit it.'"

    Wednesday, Feb. 15

    Kenneth Rice remained on the stand, and admitted that his prior day's testimony was misleading.  Skilling may not have knowingly misled investors during a March 2001 conference call on the losses of Enron Broadband Services, said Rice. 

    The defense worked on painting Rice as an opportunist who struck a deal with the government to avoid a lengthy prison sentence.

    Thursday, Feb. 16

    The former head of Enron Broadband Services (EBS), Kenneth Rice, testified in his third day on the stand that his former boss Skilling directed him in May 2001 to paint a rosy, misleading picture for Enron's board of directors on the financial success of EBS. Rice said that what he presented to the board -- a picture of success for the broadband unit -- was inconsistent with how EBS was performing.

    However, Rice has only his recollection and no physical evidence to back up this 2001 conversation, he said.

    In news separate from the trial, bankrupt Enron Corp. reached as agreement with the U.S. Department of Labor that will pay out $133.9 million to Enron's current and former workers as part of their retirement benefits.

    WEEK 4

    Monday, Feb. 21

    Presidents' Day

    Tuesday, Feb. 22

    Paula Rieker, a fomer executive of the broadband unit under Mark Koenig (the first witness in the trial), took the stand for the prosecution. Reiker told the jury that Kenneth Lay took an active role in preparing misleading statements about financial conditions at the company during his five-month tenure as Enron CEO.

    In May 2004, Rieker pleaded guilty to insider trading. In addition to her role at Enron Broadband Services, she had served as corporate secretary to the Enron board of directors.

    Wednesday, Feb. 23

    During her second day on the stand, Paula Rieker, the former corporate secretary to the Enron board of directors, told jurors that Enron founder Kenneth Lay downplayed or hid bad news from Wall Street. Rieker admitted that she sometimes ignored actions by Enron executives that she shouldn't have.

    According to Rieker, at a 2001 meeting no officer or director objected to a reorganization that allowed the energy trader to disguise $655 million in sales losses with $2 billion in trading gains earned during the California power crisis.

    Thursday, Feb. 24

    Lead defense attorney Daniel Petrocelli hammered away at Paula Rieker during her third stay on the stand. Petrocelli tried to portray Rieker, an Enron employee for 14 years and second-in-command of investor relations when Enron folded, as a greedy manager. Rieker admitted that she overlooked questionable management decisions because she was "very well compensated" and "didn't have the nerve to quit."

    Rieker continued to provide the jury with testimony that Lay and Skilling knowingly misled Wall Street about Enron's earnings.

    WEEK 5

    Monday, Feb. 27

    The former top accountant for Enron's trading division, Wesley H. Colwell, testified on Monday that he used reserve accounts at Enron North America to frauduently manipulate Enron's reported earnings. Colwell said that while he was not ordered by Enron CEO Skilling to raid the accounts, it was his understanding that Skilling wanted to surpass Wall Street's expectations. In cross-examination, Colwell said no one ever told him to do anything improper with a reserve account. He did not question the timing of the changes, he said, because it was "the way" things were done at Enron.

    Colwell, 46, is not charged with a crime. In 2003 he paid the SEC $500,000 million to settle civil allegations of manipulating Enron's earnings.

    Tuesday, Feb. 28

    The five-week-old trial continued with what may be perceived as the strongest testimony yet. David W. Delainey, former head of the Energy Services unit at Enron, testified that in 2001 then-CEO Jeffrey Skilling signed off on an improper accounting move that shifted Energy Services losses to the wholesale division. Delainey said that he initally resisted the idea because he knew it was improper, but succumbed to pressure from top executives -- including Skilling and the then-chief accounting officer Richard Causey -- to go along with the plan.

    Delainey also testified that Skilling was aware of the use of Raptor accounting vehicles to remove millions of dollars of debt from Enron's books.

    Ex-Enron chief Kenneth Lay was not untouched by Delainey's testimony. According to Delainey, Lay signed off on the shift of about $1 billion in energy bills owed by California utilities from retail energy to wholesale. This move contained Enron's losses at about $500 million.

    Delainey, 40, has pleaded guilty to insider trading. He faces a maximum prison term of 10 years. He forfeited to the federal government $7.9 million of his $11 million earned while at Enron.

    Wednesday, March 1

    On cross-examination, the prosecution's most damaging witness to date held firm on his previous day's testimony. David Delainey, former head of Enron Energy Services, said that Skilling, while not explicitly telling Delainey to shift money to hide the energy unit's losses, knowingly partook in the operation.

    Thursday, March 2

    In his third and final day on the stand, David Delainey, a former Enron executive at the company's energy unit, said he questioned the use of Raptors -- off-the-books financial structures backed by company stock to serve as insurance against losses -- "were a plot of money we used to manipulate our income statements." Delainey called the structure "odd." He said he relied on former CEO Jeffrey Skilling and former CFO Andrew Fastow to affirm the use of the structures.

    Another witness, Kevin Hannon, a former Enron broadband unit executive, said he heard Skilling say "they're on to us" in a 2001 meeting of Enron executives. Skilling's remark came in response to a small analyst firm's criticism of Enron's reliance on partnerships run by its own finance chief to buy underperforming assets so that the energy company could boost earnings and get debt off its balance sheet, the Associated Press explains.

    WEEK 6

    Monday, March 6

    The defense attempted to discredit former Enron broadband unit executive Kevin Hannon's testimony that Jeffrey Sklling remarked "they're on to us" in a May 2001 meeting of Enron executives that included Kenneth Lay and former Chief Accounting Officer Richard Causey. The remark came after a small analyst firm questioned Enron for certain partnerships.

    On cross-examination, Skilling lawyer Mark Holsher asked Hannon if it was possible that Skilling was "dripping with sarcasm." Hannon replied: "Anything's possible."

    Hannon also admitted to jurors that he lied in his 2002 testimony to the SEC, in which is painted a rosier picture of Enron.

    Tuesday, March 7

    Former Enron finance chief Andrew Fastow tied his boss, Jeffrey Skilling, to partnerships that helped the company mask as much as hundreds of millions of dollars in losses. Fastow told jurors about a partnership, known as LJM1, set up in 1999 to help Enron "solve a problem" -- future losses from its investment in a startup firm. For more on this story from the Associated Press: Fastow Links Skilling to Losses at Enron

    Wednesday, March 8

    Andrew Fastow, the former Enron CFO who himself will spend 10 years in federal prison as part of his plea deal with the government, said Kenneth Lay knew of the company's withering finances in late 2001 but still painted a rosy picture for Wall Street analysts.

    Under cross-examination today, Skilling attorney Daniel Petrocelli focused on the willingness of Fastow to watch his wife, Lea, serve a year in prison for a false tax return that she signed, rather than come clean with federal investigators about kickbacks he received from Enron in 1997. Fastow has said his wife did not know she was signing a false tax return.

    According to the Associated Press, if the government is unhappy with Fastow's testimony in this trial, it can still prosecute him on 96 criminal charges.

    Despite the grilling Fastow received from Petrocelli, the highlight of the day may have been the attendance of former HealthSouth CEO Richard Scrushy. Acquitted last year of charges that he masterminded a $2.7 billion fraud at HealthSouth, Scrushy said he was in town and decided to drop by to hear for himself the court happenings, rather than rely on media reports. He told a group of reporters that he doesn't believe Fastow is a credible witness. Scrushy himself will be back in a courtroom in May facing charges that he bribed an ex-Alabama governor.

    Thursday, March 9

    Andrew Fastow remained on the stand and under cross-examination by Skilling lawyer Daniel Petrocelli. Testimony today focused on what has been nicknamed the "Global Galactic" agreement, a handwritten, three-page document from 2000 that details the secretive side deals Fastow had created to hide billions of dollars in losses.

    Petrocelli questioned how the document, which bears the signatures of both Fastow and former accounting officer Richard Causey, ended up in Fastow's safe deposit box at a Houston bank. The discovery of the Global Galactic papers in April 2004 is questionable, Petrocelli said, because Fastow found them shortly after he and his wife Lea pleaded guilty to different charges.

    Fastow said that at the time he found the document, he knew it incriminated him, Skilling, and others.

    In testimony earlier this week, Fastow said that in 2000 he gave the "Global Galactic" document to Richard Causey, who had in turn shown it to Skilling. According to Fastow, Causey said that Skilling gave him a "bear hug" approval after reading the document. However, Fastow could not provide a paper trail proving that Skilling approved of the fraudulent partnerships.

    Testimony will resume on Monday, when Kenneth Lay's attorney is expected to cross-examine Fastow.

    WEEK 7

    Monday, March 13

    In his last of four days on the stand, former Enron CFO Andrew Fastow answered questions from the attorney for Enron founder Kenneth Lay. Lawyer Michael Ramsey attacked Fastow's credibility and asked if he lied to Lay about stealing funds from Enron and if he was disloyal. Fastow reportedly replied, "Yes, I was not loyal to him or Enron when I committed those crimes."

    Fastow himself already pleaded guilty to two charges and will spend 10 years in prison. He is a key witness for the government.

    Tuesday, March 14

    Chris Loehr, a former Enron investment analyst who quit the company in August 2001, corroborated testimony from Andrew Fastow that the company used improper partnerships and Raptors to hide losses.

    The prosecution asked Loehr if Enron's accountants were aware of the improper accounting practices being employed. Loehr said, "Yes, on several occasions. In general, the accountants would say, 'I didn't hear that, see no evil, hear no evil' sort of comments," the Associated Press reports.

    Loehr is testifying for the prosecution as part of an immunity deal.

    Wednesday, March 15

    Sherron Watkins, the former Enron accountant who foresaw Enron's collapse and warned higher ups of her concerns, testified that she had spoke directly with former CEO Kenneth Lay about her issues with Enron's shady accounting practices.

    Watkins, 46, said Lay "seemed surprised that these things could be problematic." While at Enron, Watkins reported to then-CFO Andrew Fastow.

    Watkins read to the jurors a memo she had sent to Lay -- at the time sent anonymously -- that said, "I am incredibly nervous that we will implode in a wave of accounting scandals."

    In August 2001, Watkins sold $30,000 in stock, a sale she testified was improper because she "had more information than the marketplace did." Watkins has been hailed as the "whistleblower," but in fact she did not come forward with her damaging insider information until after Enron's collapse. She left in November 2002.

    Thursday, March 16

    Jurors took the day off today.

    WEEK 8

    Monday, March 20

    Former Arthur Andersen accountant John R. Sult testified that Enron tried to do an end-run around accounting rules by dropping a plan to sell assets in a failed water business for a $1 billion growth strategy. Had the company recorded the losses as required by a rule effective January 2002, the total losses would have been $700 million. More on this story.

    Tuesday, March 21

    Former Enron treasurer Ben Glisan Jr. testified that Lay and Skilling lied when they told Enron investors in 2001 that the company was "in great shape." On Aug. 14, 2001 -- the day Skilling resigned from his top position and Lay took over -- the two told investors in a conference call that Enron was in its "strongest shape" ever, when in fact the company was in serious debt.  

    Glisan, 40, received a five-year prison term and was on furlough from prison today to testify. In 2003 he pleaded guilty to a charge of conspiracy to commit securities and wire fraud. He is one of two former Enron employees currently serving time. The other is Dan Boyle, former vice president of global finance.

    With his testimony, Glisan gets immunity from further prosecution.

    After the trial adjourned for the day, Lay's attorney, Michael Ramsey, called Glisan "a performing monkey" and his testimony "a scripted ventriloquism show."

    Wednesday, March 22

    Former Enron treasurer Ben Glisan Jr. testified that Lay in 2001 inquired how to manage the company's accounting to avoid a credit rating downgrade. Glisan said that Lay had him review credit-ratings agencies to find out how large the writedown could be without jeopardizing Enron's credit rating. Glisan's inquiries found that Enron could charge up to $1 billion without a downgrade. That's the amount that Enron posted as losses in its third quarter 2001 earnings.

    Thursday, March 23

    Former Enron treasurer Ben Glisan Jr. remained on the stand today, marking his third day of testimony and on furlough from prison. On cross-examination, Skilling lawyer Daniel Petrocelli noted that despite the many notes that Glisan took during his tenure at Enron, he had no physical evidence that linked Skilling to any wrongdoing. Lay's lawyer did not question Glisan today.

    Glisan is the last major witness for the prosecution, which expects to wrap up its case next week with a few more witnesses.

    WEEK 9

    Monday, March 27

    Kenneth Lay's lawyers attempted to weaken the testimony of former Enron treasurer Ben Glisan Jr.  Today Lay lawyer Bruce Collins got Glisan to acknowledge that in 2001 he had assured Lay and other executives that the company had adequate access to cash to operate -- $1.5 billion. However, he explained under further questioning from the prosecution that he sought approval at that meeting to seek more loans from banks -- an unnecessary move had the company not needed additional liquidity, said Glisan.

    Tuesday, March 28

    The prosecution rested its case today. In all, the government presented 22 witnesses.

    Also today, U.S. District Judge Sim Lake dismissed two counts of securities fraud and one count of lying to auditors against Skilling because the prosecution failed to produce evidence for the time period those crimes allegedly took place. For the same reason, one count of securities fraud was dismissed for Lay.

    The defense will begin its case on Monday, April 3.

    WEEK 10

    Monday, April 3

    The lawyers for Kenneth Lay and Jeffrey Skilling began their case today. The first witness to take the stand, Joannie Williamson, the former assistant at various times to a variety of Enron head honchos, including Lay and Skilling, told jurors she believed a key prosecution witness lied in earlier testimony.

    The testimony in dispute is that of Mark Koenig, former executive vice president of investor relations. Earlier in the trial, Koenig told jurors, "I pled guilty because I am guilty."

    But Williamson testified today that she did not believe Koenig was guilty, and that he, as well, admitted to her that he was not guilty, but that the guilty plea was necessary "in order for this to work."

    More on this story from AP 

    Tuesday, April 4

    The defense continued to peck away at government claims. Matt Metts, a former M&A executive for Enron, testified to counter testimony from former CFO Andrew Fastow.

    Lawyer Daniel Petrocelli said his client may testify on Thursday.

    Wednesday, April 5

    Max Hendrick III, a partner with Enron's outside law firm, Houston-based Vinson & Elkins LLP, said a September 2001 investigation found no evidence that Enron sough retaliation against Sherron Watkins for blowing the whistle.

    Watkins had wanted an independent investigations into her claims, one by the accounting firm and one by the law firm. Instead, she said that Vinson & Elkins took Arthur Andersen's word that the accounting was legitimate.

    Thursday, April 6

    The defense's testimony continued with James Derrick, former legal counsel for Enron. According to Derrick, neither Skilling or Lay ordered earnings reports to be fixed to appear more favorable.

    Derrick told jurors that Skilling appeared changed after three workers were killed at the company's Teeside, England, plant from an explosion. Shortly thereafter, Skilling resigned from his CEO post.

    Skilling's testimony is expected to begin on Monday.

    WEEK 11

    Monday, April 10

    After 10 weeks into the fraud trial, Jeffrey Skilling -- long portrayed as Lay's partner-in-crime and blamed for Enron's downfall -- took the stand on Monday in his own defense. He declared he was "absolutely innocent" and would fight the fraud and conspiracy charges "until the day I die." For more on his testimony today: On Stand, Skilling Vows to Fight Charges

    Tuesday, April 11

    On the stand for his second day of testimony, Skilling answered his attorney's questions about the government's indictment against him, which includes allegations that he frauduently hid Enron's losses.

    Skilling repeatedly denied that he asked subordinates to lie about Enron's financials or to falsify the numbers. He also denied allegations that the company had pre-set earnings targets.

    When asked by his attorney, Daniel Petrocelli, if he was "smart enough" to mastermind the alleged conspiracy, the former CEO responded, "I don't think so. It never crossed my mind."

    Petrocelli asked Skilling if he was consumed by greed. Skilling answered that he was "consumed by this company" that he "wanted to build this company into an institution."

    Wednesday, April 12, 2006

    The former CEO of Enron, Jeffrey Skilling, told jurors that he did not mislead Wall Street. He continuously denied that he cooked the books, and provided his own take on the stories told by the prosecution's witnesses.

    For instance, he said he was disappointed in the earlier testimony against him by the former head of Enron's energy services, David Delainey, who testified that Enron established a "cookie jar" reserve of $800 million that was used to manipulate earnings. He said that number was about $300 million, and the reserves were a prudent risk-management practice in light of volatile energy trading markets (1).

    "There were no cookie-jar reserves at Enron," said Skilling.

    Thursday, April 13, 2006

    During his fourth day on the stand, Skilling took some time to lash out at prosecutors, calling the government's case against him "absurd" and "a rewriting of history to accomplish certain objectives." He later apologized and said he needed to "calm down," the Associated Press reports, but went on to say prosecutors "have purposely not looked at the facts."

    Skilling detailed the millions of dollars he earned while at Enron between 1999 and 2001. He told the jury that he did not recall his bid to sell Enron shares Sept. 6, 2001.

    Prosecutors are expected to cross-examine Skilling next week.

    WEEK 12

    Monday, April 17

    On the stand for cross-examination, former Enron CEO Jeffrey Skilling denied that his testimony, which began last week, was rehearsed and tailored to undermine the government's case against him.

    Prosecutor Sean Berkowitz challenged several statements made by Skilling last week. In particular, Berkowitz had Skilling reiterate that he did not remember telling his broker on Sept. 6, 2001, to sell 200,000 Enron shares until after he heard the recorded tape of that call. Those stocks actually sold on Sept. 17, 2001, the first day the market opened after the September 11 terrorist attacks.

    Skilling also denied that he told his ex-wife and his then-girlfriend to sell Enron stock in October and November of 2000. Susan Skilling exercised $14 million in October 2000; Rebecca Carter, now his wife, exercised $1.6 million in November 2000.

    Tuesday, April 18

    Skilling sparred with a prosecutor when challenged about whether the company used fraudulent financial structures and other means to fudge its numbers in the years before it collapsed into bankruptcy proceedings. Full story

    Wednesday, April 19

    On the stand again, Skilling denied that Enron hid $200 million in losses suffered by the company's retail arm. He stuck with his assertion that Enron never hid its dependence on trading profits.

    Skilling emerged from three days of cross-examination from the prosecution. He is expected to be questioned on Thursday by his lead attorney and then may be subject to more cross-examination next week.

    Thursday, April 20

    Skilling ended lengthy testimony in his federal fraud trial by denying a new government accusation -- that he may have cheated on his taxes. Full story

    WEEK 13

    Monday, April 24

    On the stand in his own defense for the first time today, Enron founder Kenneth Lay denied that he lied to investors about Enron's financial instability. Lay is battling to clear himself of six counts of conspiracy and fraud.

    Lay spent the day painting a picture of himself as a hard worker and said that even "the loss of life of many of my loved ones" did not compare to the "hurt and destruction and pain" that came with Enron's collapse.

    Lay said the trial thus far has been marred with "a lot of lies, a lot of misinformation and some truth."

    Tuesday, April 25

    Ken Lay said the media's 2001 reports of troubles at Enron created a firestorm that began Enron's descent into bankruptcy. The articles by the Wall Street Journal, the first of which appeared on October 17, 18 and 19, questioned certain off-the-books partnerships created by then-CFO Andrew Fastow. Enron's stock plunged 19 percent during those three days.

    Today, Lay said that he was not aware of Fastow's off-the-books financial structure, Chewco, until Enron's lawyers and accountants looked into it. Enron's board supported until October 24, when they suspended Fastow. He admitted self-dealing.

    Lay said his subordinates encouraged him to stonewall the Journal because they felt the articles were biased.

    In addition to the six charges Lay faces in this joint trial with Skilling, he is also accused of obtaining $75 million  in loans from three banks and reneging on an agreement that he would not use the money to buy Enron stock on margin. Those charges will be deliberated without a jury by Judge Lake while the Skilling-Lay jurors deliberate.

    Wednesday, April 26

    His third day on the stand, Lay put the responsiblity of an accounting mistake on Enron's outside accountants, Arthur Andersen, saying the firm cleared the decision.

    Lay's lawyer, George Secrest, asked him to explain the government's charge about the $1 billion loss that was inappropriately characterized as a "nonrecurring event."

    Thursday, April 28

    Prosecutors attempted to undermine Lay's contention that short-sellers were partly to blame for Enron's plunge into bankruptcy.

    Federal prosecutor John Hueston, cross-examining Lay today, displayed for jurors a brokerage statement showing Lay's own son, Mark, sold Enron's stock short four times in March 2001.

    Hueston asked Lay if his son was a "vulture" -- the label Lay's attorney gave short-sellers in his opening statement.  Lay answered, "I would think not."

    WEEK 14

    Monday, May 1

    The Associated Press reports that "Lay flashed his temper to prosecutor John Hueston, comparing Hueston's second-guessing of his decisions during Enron's downward spiral to carving up a corpse." Get the full story from AP

    Tuesday, May 2

    Lay wrapped up his testimony after six days on the stand. He professed his love for Enron, the company he founded, and the company's employees. He continued to blame ex-CFO Andrew Fastow for the company's financial troubles.

    Jerry Arnold, an accounting professor from the University of Southern California who was hired by the defense for more than $1 million, testified that Enron accounting and financial reporting was sound. He provided minute details of accounting regulations and focused on Enron's third quarter of 2001 when the company reported $638 million in losses.

    Arnold is expected to return to the stand on Wednesday.

    Wednesday, May 3

    Last-minute changes to quarterly earnings reports prosecutors contend were ordered by Enron Corp. Chief Executive Jeffrey Skilling to improve the company's reputation on Wall Street were accurate, and not the result of improper tapping of company reserves, a defense expert testified. Full report 

    Thursday, May 4

    Scheduling problems prevented witnesses from testifying Thursday afternoon. It was announced that former chief accounting officer Richard Causey will not testify in the trial.

    Judge Lake told jurors that he expects the trial to conclude next Thursday. Also, Lake denied Lay's attorney's request to delay his bank fraud bench trial until May 22. That case will begin as jurors deliberate the Lay-Skilling fraud case.

    WEEK 15

    Monday, May 8

    After 14 weeks, testimony ended today in the Enron fraud trial. A dozen hours of closing arguments remain, however, set to start on May 15. The jury is scheduled to begin deliberations on May 17.

    Lay's other trial for bank fraud charges begins May 18, tried before the same judge overseeing the Lay-Skilling trial, but without a jury.

    In total, 54 witnesses testified for the prosecution and defense, including the accused, Ken Lay and Jeff Skilling.

    Wednesday, May 10

    Judge Sim Lake's final instructions to the jury next week will include a "knowledge and deliberate indifference" instruction -- jurors will be able to consider whether Lay and Skilling deliberately closed their eyes to the inappropriate and frauduent happenings at the company they managed.

    WEEK 16

    Monday, May 15

    In closing arguments today, prosecutor Kathryn Ruemmler told jurors that the defendants Ken Lay and Jeff Skilling "lied over and over and over again" to investors and employees through "accounting tricks, fiction, hocus-pocus, trickery, misleading statements, half-truths, omissions and outright lies."

    Closing arguments from the defense are expected to begin Tuesday.

    Tuesday, May 16

    The government bore down on Enron Corp. as it would the Mafia, intimidating top lieutenants into pointing fingers at their bosses because someone had to pay for crimes that preceded the company's stunning collapse, the lawyer for former Chief Executive Jeffrey Skilling said Tuesday. Full story

    Wednesday, May 17

    Take a closer look at those involved in the Enron scandal, including the status of their cases: those awaiting a verdict, those on trial, those awaiting trial, those convicted, etc.

    Thursday, May 18

    The jury wrapped up a 10-hour day in its first day of delibations. Meanwhile, Ken Lay began his bank fraud bench trial.

    The jury will take a long three-day weekend and resume deliberations on Monday.

    WEEK 17

    Monday, May 22

    Jurors concluded their third day of deliberations. The only request made today by the jury of four men and eight women was for speakers to plug into their laptops, presumably to listen to audio tapes of analyst calls (AP).

    Tuesday, May 23

    Jurors ended the fourth day of deliberations without any hint of their progress.

    Separately, Lay's bank fraud trial is now in the hands of Judge Sim Lake, who heard the case without a jury.

    Wednesday, May 24

    Jurors resumed discussions on the fate of Skilling and Lay in the fifth day of deliberations.

    Thursday, May 25

    The 17-week trial came to a conclusion today with jurors handing down guilty verdicts:

    • Lay was convicted on all six counts
    • Skilling was convicted on 19 of the 28 counts

    In a separate trial presided over by Judge Lake, and without a jury, Lay was also convicted of bank fraud and making false statements to banks.

     

    Sources: The Associated Press, Reuters, Bloomberg News, Washington Post.

    (1) "Skilling says he played it straight." Chicago Tribune. April 12, 2006.

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