Criminal Charges Against Enron’s Skilling Expected Soon

A criminal indictment against former Enron chief executive Jeffrey Skilling is expected to be handed up sometime this month, sources close to the case say.

Two sources, who spoke to the Houston Chronicle last week on condition of anonymity, said federal prosecutors were finalizing criminal charges against Skilling. Specific charges were not known, but the sources said that the Department of Justice investigation has heated up in recent weeks and that information provided by former finance chief Andrew S. Fastow is playing a part in the potential indictment of Skilling.

A lawyer for Skilling, Bruce Hiler, said that his client had done nothing to warrant criminal charges. He said that all of Skilling's actions were taken with the knowledge and approval of scores of lawyers, accountants and members of the company's board.

"If the COO can be indicted for transactions that were reviewed and recommended by dozens of experts, then no COO should go to work tomorrow morning, because if something goes wrong with their company, they are in danger of being indicted," Hiler told the New York Times.

Skilling served as chief operating officer at Enron from 1997 until he succeeded Enron founder and former chairman Kenneth Lay as chief executive officer three years ago. After only six months on the job, Skilling abruptly resigned, Lay took over again as CEO and Enron went bankrupt a few months later.

The possible charges against Skilling come on the heels of an agreement by Fastow to plead guilty to two counts of conspiracy, provide evidence against others and serve 10 years in prison. People involved in the case say that Fastow’s information contributed to the indictment of Richard A. Causey, Enron’s former chief accounting officer. He was charged with conspiracy and fraud for allegedly manipulating accounting and finances to make Enron look more profitable than it was.

Nine of the 27 people who have been charged in the Justice Department’s investigation have pleaded guilty. Skilling and Lay have yet to be charged related to the hidden debt, inflated profits and accounting schemes that led to the company’s collapse.

You may like these other stories...

Accounting group pushes back against retirement age scrutinyMichael Rapoport of the Wall Street Journal reported that the American Institute of CPAs (AICPA) on Monday pushed back against federal regulators who are again...
There's still time to take advantage of last-minute, tax-saving moves for dependency exemptions. For 2014, there are bigger dependency exemptions, as well as rules that, in some cases, are dauntingly complex.The 2014...
Tesco accounting probe finds “inappropriate behavior” by staff – reportsClare Hutchison of Reuters wrote on Sunday that an investigation into a 250 million-pound ($402 million) profit overstatement at...

Already a member? log in here.

Upcoming CPE Webinars

Oct 22This webinar will include discussions of important issues in AU-C 800, Audits of Financial Statements Prepared in Accordance with Special Purpose Frameworks.
Oct 23Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.
Oct 30Many Excel users have a love-hate relationship with workbook links.
Nov 5Join CPA thought leader and peer reviewer Rob Cameron and learn ways to improve the outcome of your peer reviews while maximizing the value of your engagement workflow.