Risk & Compliance

Enron Audiotape Prompts Second Thoughts

After listening to the evidence, a former executive now maintains that a misleading statement was made not by him, but by Jeffrey Skilling.
Stephen TaubJanuary 10, 2006

Mark Koenig, the former head of investor relations for Enron Corp., now maintains that a false statement he admitted to making was actually made by former chief executive officer Jeffrey Skilling, according to the Houston Chronicle.

In August 2004, Koenig pleaded guilty to aiding and abetting securities fraud and agreed to cooperate with prosecutors. He is expected to testify in the trial, scheduled to begin January 30, against Skilling and former chairman Kenneth Lay.

In his 2004 plea, Koenig reportedly stated that he personally lied during a July 12, 2001, conference call with analysts. According to the newspaper, in that original plea he maintained that he said Enron Energy Services was reorganized “to get some more efficiency” when it was really reorganized largely to conceal losses.

After hearing a tape of the analyst call, however, Koenig felt that it was Skilling who in fact made the quoted remark, according to the Chronicle. The paper stressed that in his changed plea, which was accepted by U.S. District Judge Ewing Werlein, Koenig still asserts that he and others communicated the same false message to analysts.

“Mr. Koenig pled then and apparently is pleading again to crimes that neither he nor Jeff Skilling committed,” said Skilling’s lead lawyer, Daniel Petrocelli, according to the Chronicle. Prosecutors and Koenig’s attorney, Philip T. Inglima, did not offer comment to the paper.

Koenig reportedly faces up to 10 years in prison and a $1 million fine.

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