Risk & Compliance

Former Enron CEO Skilling Pleads Not Guilty

Charged with 35 counts including fraud and insider trading, the ex-chief executive could get a life sentence.
Ed ZwirnFebruary 20, 2004

It took over two years, but Jeffrey Skilling finally did his version of the perp walk yesterday.

The former Enron Corp. CEO, the highest-ranked catch so far of a lengthy fraud investigation into the collapsed company, was taken to a Houston court in handcuffs Thursday, where he pleaded not guilty to 35 counts of fraud and other crimes, Reuters and other services reported. He is next scheduled to appear in court March 10.

The 42-count indictment accuses Skilling and Richard Causey, Enron’s former chief accounting officer, of taking part in the schemes to mislead regulators and investors. Causey was indicted a month ago and is free on $500,000 bond.

Ten of the counts accounts against Skilling, who posted $5 million bond using a cashier’s check, accused him of insider trading. That trading is alleged to have generated $62.6 million from stock sold from April 2000 through September 2001, about a month after he quit Houston-based Enron. According to the indictment, during that time he sold shares in blocks ranging from 10,000 to 500,000, and Enron stock sold as high as $87, in September 2000, and as low as $31, in September 2001, reported the Associated Press.

The charges against Skilling also included conspiracy, securities fraud, and wire fraud. If he is convicted on all counts, he could receive a sentence of life imprisonment and more than $80 million in fines, according to The New York Times.

The indictment unsealed Thursday also mentions former chief financial officer Andrew Fastow, who pleaded guilty and is cooperating with federal prosecutors, and former treasurer Ben Glisan, who pleaded guilty to conspiracy and became the first former Enron executive put behind bars. Fastow was sentenced to 10 years in prison.

The indictment makes no mention of Skilling’s former boss, former Enron chairman Kenneth Lay, either by name or by title. Lay, who served as CEO before Skilling, has maintained his innocence of any wrongdoing related to Enron’s failure.

Deputy Attorney General James Comey, who heads the Justice Department’s corporate fraud task force, was quoted by AP as saying that Skilling and other executives were responsible for a ”massive, complex scheme to give shareholders and the investing public the false appearance of financial strength and security at a time when Enron was, in fact, failing.”

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