From the Annals of Corporate Greed –  In 2001, the Enron Corporation filed for Chapter 11 bankruptcy protection.  Enron was formed in 1985 as the merger of two gas companies, Houston Natural Gas and Internorth. Chairman and CEO Kenneth Lay engineered Enron’s rise to 7th place in the Fortune 500.  At its peak, Enron employed 21,000 people and posted revenue of $111 billion. The peak was short-lived as Enron’s business model came under more and more scrutiny.  The stock price fell off the cliff, dropping from $90.75 in August 2000 to $0.26 on November 30, 2001.

The rightly maligned Lay sold large amounts of his Enron stock, but encouraged the average Enron employees to buy more shares claiming that the company was on the rebound. Many employees faced financial ruin when Enron’s stock price continued to plummet.  By the end of 2001, Enron’s collapse had cost investors billions of dollars, wiped out some 5,600 jobs and liquidated almost $2.1 billion in pension plans.

For a time, Enron was the poster child for major corporate fraud and corruption.  Numerous investigations revealed that Enron had inflated its earnings by hiding debts and losses in subsidiary partnerships. Lay and Jeffrey Skilling, who served as Enron’s CEO from February to August 2001 were indicted on federal conspiracy charges for their scheme of covering up Enron’s crooked financial practices. Among Enron’s victims was accounting firm Arthur Anderson, whose auditors were found guilty of deliberately destroying documents incriminating to Enron.

Skilling, the principal villain in Enron’s collapse was indicted and convicted and sentenced to 24 years in prison. Lay was also convicted but died before serving any time.