Risk & Compliance

Ken Lay’s Assets Up for Grabs

Prosecutors maintain that the assets are tied to Enron's massive fraud; his widow asserts that they were transferred to her after his death last July.
Stephen TaubApril 18, 2007

Linda Lay, the widow of former Enron chairman Kenneth Lay, is in a tug-of-war with the government over nearly $13 million of her late husband’s assets.

Prosecutors maintain that the assets are tied to Enron’s massive fraud. But in a court filing, reported the Associated Press, Linda Lay has asserted that her husband’s interest in the assets was transferred to her upon his death last July.

“That’s just standard,” attorney Stanley Schneider told the Houston Chronicle, in reference to the court filing. “Anyone who has an interest in the property has to file a claim.”

The disputed assets reportedly include $2.5 million of the value of the Lays’ condominium — which prosecutors claim Lay spent to pay off its mortgage shortly after Enron went bankrupt in December 2001 — more than $10 million in cash controlled by a partnership named for both of them, and about $22,000 in a bank account.

According to the Chronicle, Linda Lay insists that her husband had a half-interest in the condo and the bank account but no longer in the partnership.

Lay was convicted in May 2006 on ten counts of fraud and conspiracy in two separate cases, but since he died before exhausting his appeals, Lay’s indictment convictions were wiped from the record under a legal principle known as the abatement doctrine. And since there are now no criminal convictions, prosecutors must sue Lay’s estate to recover any money.

4 Powerful Communication Strategies for Your Next Board Meeting