Famous case of Enron company.Famous case of Enron company.

INDEPTH: ENRONFrom collapse to convictions: a timeline

The World The World famous logo famous logo among the among the best 10 best 10 corporate corporate company’s company’s in the world in the world at that time.at that time.

Structure of company……..Structure of company……..

1985:1985: Enron began in 1985, it started operations as an interstate interstate pipeline company. Enron is formed pipeline company. Enron is formed by the merging of Houston Natural by the merging of Houston Natural Gas and Omaha-based InterNorth Gas and Omaha-based InterNorth

Former Enron CEO Jeff Skilling

Enron founder Ken Lay

Enron’s CEO

Expansion of company…….Expansion of company…….

1988:1988: Enron opens offices in the U.K. Enron opens offices in the U.K. after the country's privatizes its after the country's privatizes its power industry. power industry.

1989: Enron opens its Gas Bank, where consumers can buy long-term supplies of natural gas at a fixed price, even as the real price fluctuates.

1990-1998:1990-1998: Enron expands Enron expands its holdings in the U.K., its holdings in the U.K., Europe, South America and Europe, South America and India.India. It moves away from natural It moves away from natural gas and pipeline operations to gas and pipeline operations to marketing in other energy-related marketing in other energy-related commodities commodities

Enron entered into world market..Enron entered into world market..

1999:1999: Enron launches its broadband Enron launches its broadband services unit and Enron Online, the services unit and Enron Online, the company's website for trading company's website for trading commodities, which soon becomes the commodities, which soon becomes the largest business site in the world. About largest business site in the world. About 90 per cent of its income would 90 per cent of its income would eventually come from trades over Enron eventually come from trades over Enron Online. Online.

Best achievement of Best achievement of company……..company……..

August 2000:August 2000: Enron's shares hit an Enron's shares hit an all-time high of more than $90 US. all-time high of more than $90 US. Annual revenues reach $100 billion Annual revenues reach $100 billion US. It is ranked the sixth-largest US. It is ranked the sixth-largest energy company in the world. energy company in the world.

Ups &Downs Of company……..Ups &Downs Of company……..

October 2001:October 2001: Enron reports its first Enron reports its first quarterly loss in four years, $618 million US, quarterly loss in four years, $618 million US, and a reduction in shareholder equity of over and a reduction in shareholder equity of over $1 billion. CFO Andrew Fastow is replaced. $1 billion. CFO Andrew Fastow is replaced. The Securities and Exchange Commission The Securities and Exchange Commission begins an investigation related to begins an investigation related to investment partnerships led by Fastow. Their investment partnerships led by Fastow. Their investigation would later show that the investigation would later show that the complex web of partnerships was designed complex web of partnerships was designed to hide Enron's debt. to hide Enron's debt.

Enron shares plunge; Enron shares plunge; DynegyDynegy abandons takeover abandons takeover

November 2001:November 2001: Enron announces Enron announces it had overstated its earnings back to it had overstated its earnings back to 1997 by about $600 million. Its 1997 by about $600 million. Its shares plunge to "junk" status by the shares plunge to "junk" status by the end of the month. The SEC adds end of the month. The SEC adds accountancy firm Arthur Andersen, accountancy firm Arthur Andersen, the auditor for Enron, to its the auditor for Enron, to its investigation. investigation.

Enron files for Chapter 11; lawsuits loomEnron files for Chapter 11; lawsuits loom

Dec. 2, 2001:Dec. 2, 2001: Enron files for Enron files for bankruptcy protection, the largest bankruptcy protection, the largest bankruptcy in U.S. history at the time. bankruptcy in U.S. history at the time. (The dubious title would later go to (The dubious title would later go to WorldCom in July 2002.) Thousands of WorldCom in July 2002.) Thousands of workers would be laid off.workers would be laid off.

Lay’s Decisions……….Lay’s Decisions……….

January 2002:January 2002: The U.S. Justice The U.S. Justice Department begins its investigation Department begins its investigation of Enron. Lay resigns as chairman of Enron. Lay resigns as chairman and chief executive. and chief executive.

Enron documents destroyed: auditoEnron documents destroyed: auditorr Jan. 10, 2002:Jan. 10, 2002: Arthur Andersen says Arthur Andersen says

its employees destroyed a its employees destroyed a "significant but undetermined" "significant but undetermined" number of Enron documents.number of Enron documents.

Fired auditor refuses to answer Enron questiFired auditor refuses to answer Enron questionsons

Jan. 24, 2002:Jan. 24, 2002: David Duncan, a David Duncan, a

former Arthur Andersen auditor who former Arthur Andersen auditor who handled the Enron bankruptcy, handled the Enron bankruptcy, invokes his Fifth Amendment right invokes his Fifth Amendment right not to incriminate himself and not to incriminate himself and refuses to testify before Congress.refuses to testify before Congress.

Former Enron executive found deadFormer Enron executive found dead

Jan. 25, 2002:Jan. 25, 2002: John Clifford Baxter, John Clifford Baxter, former Enron vice-president, is found former Enron vice-president, is found dead in his car. He was shot once in dead in his car. He was shot once in the head, and authorities treat his the head, and authorities treat his death as a suicide. Baxter resigned death as a suicide. Baxter resigned as vice-president in May 2001.as vice-president in May 2001.

Lay resigns from Enron board ahead of subpoena & Lay resigns from Enron board ahead of subpoena & U.S. Senators subpoena Enron's Lay poenapoena

Feb. 4, 2002:Feb. 4, 2002: Ken Lay resigns from Ken Lay resigns from Enron's board of directors. Enron's board of directors.

Feb. 5, 2002: The U.S. Senate Commerce Committee subpoenas former Enron CEO Ken Lay.

Former Enron CEO says was 'not aware' of fFormer Enron CEO says was 'not aware' of financial irregularitiesinancial irregularities Feb. 7, 2002:Feb. 7, 2002: Former Enron CEO Former Enron CEO

Jeffrey Skilling denies any knowledge of Jeffrey Skilling denies any knowledge of financial or accounting irregularities. At financial or accounting irregularities. At the same hearing before Congress, the same hearing before Congress, four Enron executives, including former four Enron executives, including former CFO Andrew Fastow, invoke their Fifth CFO Andrew Fastow, invoke their Fifth Amendment right against self-Amendment right against self-incrimination and decline to testify.incrimination and decline to testify.

Enron's Lay refuses to testifyEnron's Lay refuses to testify

Feb. 12, 2002:Feb. 12, 2002: Former CEO Lay Former CEO Lay declines to testify before Congress, declines to testify before Congress, citing his Fifth Amendment right citing his Fifth Amendment right against self-incrimination.against self-incrimination.

Arthur Andersen charged with obstruction in Arthur Andersen charged with obstruction in Enron caseEnron case

March 14, 2002: Arthur Andersen is March 14, 2002: Arthur Andersen is

charged with obstruction of justice charged with obstruction of justice for destroying paper and computer for destroying paper and computer documents related to Enron as the documents related to Enron as the SEC investigation started.SEC investigation started.

Michael Michael KopperKopper becomes first ex-Enron exec to plead guilty becomes first ex-Enron exec to plead guilty

Aug. 21, 2002:Aug. 21, 2002: Former Enron Former Enron executive Michael Kopper pleads guilty executive Michael Kopper pleads guilty to money laundering conspiracy and to money laundering conspiracy and conspiracy to commit wire fraud. He conspiracy to commit wire fraud. He becomes the first former Enron becomes the first former Enron executive to plead guilty to criminal executive to plead guilty to criminal charges. Kopper agrees to co-operate charges. Kopper agrees to co-operate with federal investigators. with federal investigators.

Former Enron CFO charged with fraud, monFormer Enron CFO charged with fraud, money launderingey laundering

Oct. 2, 2002:Oct. 2, 2002: Former Enron CFO Former Enron CFO

Andrew Fastow is arrested on Andrew Fastow is arrested on charges of fraud and money charges of fraud and money laundering. He would eventually face laundering. He would eventually face 98 charges.98 charges.

Arthur Andersen fined, given probation over Arthur Andersen fined, given probation over Enron scandalEnron scandal

Oct. 16, 2002:Oct. 16, 2002: Accountancy firm Arthur Andersen Accountancy firm Arthur Andersen

is given the maximum sentence for obstruction of is given the maximum sentence for obstruction of justice after shredding Enron documents: five years' justice after shredding Enron documents: five years' probation and a $500,000 fine.probation and a $500,000 fine.

May 1, 2003:May 1, 2003: Lea Fastow, Enron's former assistant Lea Fastow, Enron's former assistant treasurer and wife of former CFO Andrew Fastow, is treasurer and wife of former CFO Andrew Fastow, is charged with conspiracy and filing false tax forms charged with conspiracy and filing false tax forms for her role in some of her husband's deals to hide for her role in some of her husband's deals to hide Enron's debt. Enron's debt.

Enron unveils restructuring planEnron unveils restructuring plan

July 11, 2003:July 11, 2003: Enron unveils a Enron unveils a bankruptcy restructuring plan that bankruptcy restructuring plan that would see most of Enron's 20,000 would see most of Enron's 20,000 creditors receive about 20 per cent creditors receive about 20 per cent of the $63 billion US they are owed. of the $63 billion US they are owed.

First Enron executive goes to prisonFirst Enron executive goes to prison

Sept. 10, 2003:Sept. 10, 2003: Ben Glisan, a Ben Glisan, a former Enron treasurer, pleads guilty former Enron treasurer, pleads guilty to a charge of conspiracy. He is to a charge of conspiracy. He is sentenced to five years in prison, sentenced to five years in prison, making him the first former Enron making him the first former Enron executive to go to jail.executive to go to jail.

Andrew Andrew FastowFastow agrees to plea deal; will cooperate in Enron agrees to plea deal; will cooperate in Enron casecase

Jan. 14, 2004:Jan. 14, 2004: Former Enron CFO Andrew Former Enron CFO Andrew

Fastow agrees to a plea agreement and a Fastow agrees to a plea agreement and a 10-year prison sentence. He pleads guilty 10-year prison sentence. He pleads guilty to one count of conspiracy to commit wire to one count of conspiracy to commit wire fraud and one count of conspiracy to fraud and one count of conspiracy to commit securities fraud. He also agrees to commit securities fraud. He also agrees to co-operate with federal prosecutors. His co-operate with federal prosecutors. His wife, Lea Fastow, also pleads guilty, but wife, Lea Fastow, also pleads guilty, but would later withdraw the plea.would later withdraw the plea.

Former Enron chief faces 40 federal chargesFormer Enron chief faces 40 federal charges

Feb. 19, 2004:Feb. 19, 2004: Former Enron CEO Former Enron CEO Jeffrey Skilling pleads not guilty to 40 Jeffrey Skilling pleads not guilty to 40 federal charges, from insider trading federal charges, from insider trading to making false statements to to making false statements to auditors. He posts a $5-million bond.auditors. He posts a $5-million bond.

Lea Lea FastowFastow pleads guilty to tax charge, gets 12-month s pleads guilty to tax charge, gets 12-month sentenceentence

May 6, 2004:May 6, 2004: Lea Fastow, Enron's Lea Fastow, Enron's

former assistant treasurer and wife former assistant treasurer and wife of former CFO Andrew Fastow, of former CFO Andrew Fastow, agrees to a plea agreement and a agrees to a plea agreement and a one-year prison term. She pleads one-year prison term. She pleads guilty to filing false tax forms. guilty to filing false tax forms.

Enron's Kenneth Lay pleads not guilty on 11 Enron's Kenneth Lay pleads not guilty on 11 countscounts

July 7, 2004:July 7, 2004: Former Enron founder and Former Enron founder and

CEO Kenneth Lay turns himself in to the CEO Kenneth Lay turns himself in to the Houston office of the Federal Bureau of Houston office of the Federal Bureau of Investigation. He is led in handcuffs to a Investigation. He is led in handcuffs to a courthouse, where he is charged with 11 courthouse, where he is charged with 11 criminal charges, including securities and criminal charges, including securities and wire fraud, and making false statements. wire fraud, and making false statements. He pleads not guilty to all of them. The U.S. He pleads not guilty to all of them. The U.S. Securities and Exchange Commission also Securities and Exchange Commission also files civil charges of insider trading against files civil charges of insider trading against Lay. Lay.

Enron approved to emerge from bankruptcy Enron approved to emerge from bankruptcy protectionprotection

July 15, 2004:July 15, 2004: A New York judge A New York judge

gives his approval for Enron's plan to gives his approval for Enron's plan to emerge from bankruptcy protection, emerge from bankruptcy protection, which will see the company pay $12 which will see the company pay $12 billion US of the $63 billion US it billion US of the $63 billion US it owes to about 20,000 creditors.owes to about 20,000 creditors.

Arthur Andersen's Enron conviction Arthur Andersen's Enron conviction overturnedoverturned

May 31, 2005:May 31, 2005:The U.S. Supreme Court The U.S. Supreme Court unanimously overturns the 2002 conviction of unanimously overturns the 2002 conviction of Arthur Andersen for destroying documents in Arthur Andersen for destroying documents in the Enron case. The decision says instructions the Enron case. The decision says instructions to the jury were too broad.to the jury were too broad.

July 15, 2005:July 15, 2005:Enron agrees to a $1.5 billion Enron agrees to a $1.5 billion US settlement to end claims that it US settlement to end claims that it manipulated the electricity market during the manipulated the electricity market during the California energy crisis of 2000 and 2001.California energy crisis of 2000 and 2001.

Enron settles California price-gouging claim Enron settles California price-gouging claim

July 15, 2005:July 15, 2005: Enron agrees to a Enron agrees to a $1.5-billion US settlement to end $1.5-billion US settlement to end claims that it manipulated. claims that it manipulated.

Enron exec pleads guilty to securities fraud Enron exec pleads guilty to securities fraud

Dec. 28, 2005:Dec. 28, 2005: Richard Causey, Richard Causey, former chief accountant at Enron Corp., former chief accountant at Enron Corp., pleads guilty to a single count of pleads guilty to a single count of securities fraud as part of a deal with securities fraud as part of a deal with prosecutors. Causey originally pleaded prosecutors. Causey originally pleaded not guilty to 34 counts in early 2004. not guilty to 34 counts in early 2004. The other charges were dropped, and The other charges were dropped, and Causey will be sentenced to seven Causey will be sentenced to seven years in prison.years in prison.

Jury selection underway for trial of former Jury selection underway for trial of former Enron bosses Enron bosses

Jan. 30, 2006:Jan. 30, 2006: Jury selection in the Jury selection in the trial of Enron Corp. founder Ken Lay trial of Enron Corp. founder Ken Lay and former CEO Jeffrey Skilling and former CEO Jeffrey Skilling begins in Houston. The trial is begins in Houston. The trial is expected to last about four months.expected to last about four months.

Prosecution rests in Enron trial as some Prosecution rests in Enron trial as some charges dropped against Skilling, Lay charges dropped against Skilling, Lay

March 28, 2006:March 28, 2006: The prosecution rests in The prosecution rests in the trial of Enron Corp. founder Ken Lay the trial of Enron Corp. founder Ken Lay and former chief executive officer Jeffrey and former chief executive officer Jeffrey Skilling. Three charges against Skilling and Skilling. Three charges against Skilling and one charge against Lay are dropped after one charge against Lay are dropped after the prosecution doesn't present evidence the prosecution doesn't present evidence to support them. Skilling still faces 28 to support them. Skilling still faces 28 counts of conspiracy, fraud and insider counts of conspiracy, fraud and insider trading. Lay faces six counts of conspiracy trading. Lay faces six counts of conspiracy and fraud.and fraud.

'Absolutely innocent,' ex-CEO tells Enron 'Absolutely innocent,' ex-CEO tells Enron trial trial

April 10, 2006:April 10, 2006: Former Enron chief Former Enron chief executive Jeffrey Skilling testifies in executive Jeffrey Skilling testifies in his own defence on 28 charges his own defence on 28 charges relating to the company's relating to the company's bankruptcy, telling a Houston court bankruptcy, telling a Houston court that he is "absolutely innocent" and that he is "absolutely innocent" and he would "fight these charges until he would "fight these charges until the day I die.the day I die.

Enron's Lay found guilty on all counts, Enron's Lay found guilty on all counts, Skilling on 19 Skilling on 19

May 25, 2006:May 25, 2006: In the sixth day of deliberations, a jury finds Enron In the sixth day of deliberations, a jury finds Enron founder Kenneth Lay guilty of all six counts against him, including founder Kenneth Lay guilty of all six counts against him, including conspiracy to commit securities and wire fraud. As well, former conspiracy to commit securities and wire fraud. As well, former Enron chief executive Jeffrey Skilling is convicted of one count of Enron chief executive Jeffrey Skilling is convicted of one count of conspiracy, 17 counts of fraud and making false statements and conspiracy, 17 counts of fraud and making false statements and one count of insider trading. one count of insider trading.

Lay and Skilling had blamed the collapse of what was once the Lay and Skilling had blamed the collapse of what was once the seventh-largest company in the United States on bad publicity and seventh-largest company in the United States on bad publicity and lost market confidence. Prosecutors had a different theory: they lost market confidence. Prosecutors had a different theory: they accused the two men of repeatedly lying to investors and accused the two men of repeatedly lying to investors and employees about Enron's financial health and of running an employees about Enron's financial health and of running an elaborate fraud that gave the company the illusion of success as it elaborate fraud that gave the company the illusion of success as it was hurtling toward bankruptcy. was hurtling toward bankruptcy.

Both men face lengthy prison sentences – but are expected to Both men face lengthy prison sentences – but are expected to appeal. A total of 19 former Enron executives have either pleaded appeal. A total of 19 former Enron executives have either pleaded guilty or been convicted for their part in the company's failure. guilty or been convicted for their part in the company's failure.

Disgraced Enron founder Lay dead Disgraced Enron founder Lay dead

July 5, 2006:July 5, 2006: Ken Lay, 64, dies of a Ken Lay, 64, dies of a heart attack at a family home in heart attack at a family home in Aspen, Colo. Aspen, Colo.

Ex-Enron executive Fastow gets 6-year Ex-Enron executive Fastow gets 6-year sentence sentence

Sept. 26, 2006:Sept. 26, 2006: Andrew Fastow, Andrew Fastow, Enron's former chief financial officer, Enron's former chief financial officer, is sentenced to six years in prison. He is sentenced to six years in prison. He could have been given up to 10 years, could have been given up to 10 years, but the judge notes his guilty plea and but the judge notes his guilty plea and his co-operation with authorities, his co-operation with authorities, saying "These factors call for mercy."saying "These factors call for mercy."

Judge vacates criminal convictions of Judge vacates criminal convictions of Enron's Ken Lay Enron's Ken Lay

Oct. 17, 2006:Oct. 17, 2006: A U.S. judge throws A U.S. judge throws out the criminal convictions of out the criminal convictions of Kenneth Lay because he died before Kenneth Lay because he died before he could appeal his case. he could appeal his case.

Enron's Skilling jailed for years Enron's Skilling jailed for years

Oct. 23, 2006:Oct. 23, 2006:Former Enron chief Former Enron chief executive officer Jeffrey Skilling is executive officer Jeffrey Skilling is sentenced to 24 years, four months sentenced to 24 years, four months in jail for his role in the collapse. in jail for his role in the collapse.