Prosecutor: Lay, Skilling ‘lied and lied’
HOUSTON — Enron Corp. founder Kenneth Lay and former Chief Executive Jeffrey Skilling used “hocus-pocus” to cover up a massive fraud that brought down what was once the seventh-largest company in the U.S., a federal prosecutor said on Monday.
Lay and Skilling committed crimes “through accounting tricks, fiction, hocus-pocus, trickery, misleading statements, half-truths, omissions and outright lies,” prosecutor Kathryn Ruemmler told jurors and a packed courtroom in closing arguments.
“In this courtroom, ladies and gentlemen, the cover stories have been blown. Mr. Lay and Mr. Skilling are still clinging to the cover stories,” she said.
On a large screen, Ruemmler displayed for jurors a comment Lay made during his often contentious testimony that she said encapsulated the Enron culture that the two men nurtured and embraced:
“Rules are important, but they should not … you should not be a slave to the rules either.”
Ruemmler, pacing before the jury box as the eight-woman, four-man panel listened intently, said Lay and Skilling “lied over and over and over again” and “bent rules, pushed rules and then pushed over the line” in the years before Enron sought bankruptcy protection in December 2001.
The collapse left thousands jobless and wiped out billions of dollars from investors who believed their claims.
“That is a fraud. That is why we are here. That is why this matters,” Ruemmler said.
Jurors will hear from the defense today and begin deliberations Wednesday after getting the last word from prosecutors in the case, which lasted more than 14 weeks and featured 54 government and defense witnesses.
Ruemmler said Lay and Skilling repeatedly lied to pump up Enron’s stock price and win adoration from Wall Street and their peers.
When Enron’s stock price was high, “these men and their lieutenants were on top of the world,” Ruemmler said. But throughout 2001 the stock price fell steadily. Skilling abruptly resigned in mid-August that year after only six months as CEO, leaving Lay to resume the role in addition to being chairman.