Risk & Compliance

Skilling Bats Away More Allegations

Former Enron executive denies lying to analysts, maintains that the company didn't control the notorious LJM partnerships, and says he never asked ...
Stephen TaubApril 11, 2006


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On his second day on the witness stand, former Enron chief executive officer Jeffrey Skilling refuted several key allegations of prosecutors, who have charged him with 28 criminal counts of fraud and conspiracy.

Under questioning by his lawyer Daniel Petrocelli, Skilling denied that he misled analysts during conference calls, reported the Houston Chronicle. According to the newspaper, he further denied instructing others to hide information or to make untrue statements; he even stated that other Enron participants on the calls would occasionally correct him. In earlier testimony, noted the Chronicle, former head of investor relations Mark Koenig told jurors that others feared correcting Skilling on the calls and typically did not do so.

Skilling also reportedly contradicted the prior testimony of former chief financial officer Andrew Fastow regarding the notorious LJM partnerships, which prosecutors allege helped Enron move underperforming assets off its books. According to the Chronicle, Skilling told jurors that neither he nor Enron controlled the LJM partnerships — in fact, that Enron didn’t have the ability to control those partnerships — and that he certainly didn’t go along with LJM as “a surrogate” or “a puppet” of Enron.

Skilling also told jurors that he never asked subordinates to commit crimes so the company could make its earnings targets, according to Bloomberg.

“Did you ever have a single conversation with someone at Enron in which you said, ‘We’re not cutting it, we’ve got to break the law?’ ” Petrocelli asked, according to the wire service.

Skilling reportedly replied: “I never did that. I don’t think I did anything remotely like that.”

Asked by Petrocelli, “Were you consumed by greed?”, Skilling reportedly responded, “I was consumed by this company. I wanted to build this company into an institution.” According to Bloomberg, he later added: “Money was secondary. It was the company that made a difference to me. I made more money than I ever expected, and that was plenty.”

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