Lay, on trial for fraud and conspiracy along with former Enron CEO Jeffrey Skilling, has said most of the stock sales were made to pay off his millions of dollars in debts.
Under cross examination by prosecutor John Hueston, Lay admitted he and wife, Linda, lived the good life and had trouble giving it up, despite Enron’s mounting financial troubles in 2001.
“We had realized the American Dream and were living a very expensive lifestyle,” he said as jurors took notes and appeared to listen intently.
“It’s the type of lifestyle that’s difficult to turn on and off like a spigot,” said Lay, the son of a Baptist preacher who grew up in poverty in Missouri.
Prosecutors argued Lay sold the $70 million in shares back to Enron to avoid publicly disclosing the sales immediately to U.S. regulators. Lay wanted to keep the sales quiet, they said, to avoid drawing scrutiny from investors about possible reasons for such large transactions.
Prosecutors showed credit card statements with thousands of dollars in charges for brief hotel stays in the French Riviera and a Utah ski resort, and a bill for almost $200,000 to rent a yacht for his wife’s birthday.
In January 2001, Lay said he rented the ship “Amnesia” for nearly $200,000 so that he and friends could celebrate his wife’s birthday.