The indictment alleges that Skilling conspired with other Enron executives to falsify Enron’s books in an effort to make the failing company appear successful and boost its stock price. Deputy Attorney General James Comey, who described the scheme at a news conference in Washington, said that Skilling then “unloaded” over $60 million worth of his own Enron stock, reaping what Comey described as “tens of millions of dollars” in profits.
Thousands of employees and shareholders “lost their savings” as a result of Skilling’s illegal acts, Comey said. They also “lost their faith in corporations in America.”
It was a “massive, complex scheme to give shareholders and the investing public the false appearance of financial strength and security at a time when Enron was, in fact, failing,” Comey said.
Skilling, 50, entered FBI headquarters in Houston shortly before 7 a.m. (8 a.m. EST) and was taken in handcuffs to the federal courthouse. He was later released on a $5 million bond.
The indictment, handed up yesterday but released this morning, accuses Skilling of conspiracy, insider trading, securities fraud, wire fraud and making false statements to auditors. The government wants Skilling to forfeit securities worth $49.3 million, more than $1 million held in several brokerage accounts, and property in Houston and Dallas. The Securities and Exchange Commission filed a separate civil fraud complaint against Skilling.
Daniel Petrocelli, a Skilling attorney, appeared with Skilling outside after today’s plea, saying that his client “did nothing wrong” and that the government is simply looking for a “scapegoat.”
“He did not steal, he did not lie, he did not take anyone’s money, and, in the 60 pages of charges filed by the United States government, they don’t even accuse him of these things, and it’s not for lack of trying,” Petrocelli said.