Jeffrey Skilling Case

Key People

Jeffrey Skilling is the former President of Enron Corporation. Skilling attended Southern Methodist University for his bachelors in Applied Science and went on to Harvard Business School for his Master Degree in Business Administration. His first job was as an analyst for First City Bancorporation of Texas, which was one of Enron’s banks before it failed the first time. Skilling moved on from First City where he would again work with Enron as a consultant for McKinsey & Company. Skilling impressed Lay, CEO & Chairman of Enron, so much that Lay offered him a position within the firm. He was with Enron from 1990 to 2001 serving various roles, leaving in 2001 for “personal reasons”. Soon after his departure he sold large amounts of his shares in the corporation. Skilling adopted “mark to market” accounting, in which future profits were estimated by their present value instead of their historical cost. Skilling was said to have known about the scandal or he was definitely smart enough to realize what was going on. Skilling was tried, found guilty and sentenced to twenty-four years and four months on a conspiracy charge, insider trading, five counts of false statements to auditors and twelve counts of securities fraud. Skilling is serving his time in Littleton, Colorado.

Kenneth “Kenny Boy” Lay was a CEO and Chairman for Enron and was with the corporation from 1985 until his resignation in 2002. Kenny Boy earned his Bachelors and Doctorate in Economics before 1970. There was a small gap in 2002 when Skilling served as CEO, Kenny Boy took back over after Skilling’s’ departure in 2001. Kenny Boy turned a regional natural gas pipeline business into an energy conglomerate, betting its future on unregulated energy markets. He was said to be one of the largest compensated CEO’s, with $42.4 million in compensation in 1999. Kenny Boy liquidated more than $300 million in stock from 1998 to 2001 before the Enron collapse, while at the same time encouraging his employees to buy more stating there would be a rebound. He was found guilty in 2006 of securities fraud and related charges. Kenny Boy died while vacationing in Colorado in July 2006, three months before his sentencing on the charges. There are speculations that Kenny Boy is still alive, this is just speculation though.

Andrew “Andy” Fastow served as a CFO to Enron. Fastow earned his Bachelor’s degree in Economic and Chinese and a Masters of Business Administration. Skilling hired Fastow in 1990 and Fastow was made CFO in 1998. Fastow designed a tangled web of companies that solely did business with Enron. There was an ulterior dual motive of raising money for the company, and also hiding its massive losses in their quarterly balance sheets. This would show Enron’s balance sheet debt free, while it really owed billions, in fact $30 billion at its height of debt. In 2002, Fastow was indicted by a federal