When federal investigators began looking at what went wrong with Enron, they started with the obvious – quick riches from sales of inflated stock, questionable deals by the finance chief, the CEO’s abrupt departure from a sinking ship, mass shredding of documents by the outside auditor.
The government methodically – some say ploddingly – worked from the outside in.
It would take two and a half years with many twists and turns to hook the biggest Enron fish of all – company founder and former chairman Kenneth Lay. He would be the 30th person charged and, by then, 10 would have already pleaded guilty.
Lay, who led the energy company’s heady rise and resigned under pressure after its scandalous fall, pleaded innocent Thursday to 11 counts of fraud, conspiracy and false statements to banks.
While perhaps the most highly anticipated indictment to emerge, it isn’t necessarily the last. “The investigation is most definitely continuing,” Andrew Weissmann, head of the Justice Department’s Enron Task Force, declared.
The investigation produced a steady stream of contested charges and guilty pleas from April 2002 on, as well as pending cases alleging a sham deal to sell barges, faked earnings and exaggerated prospects for broadband and rigged energy trades.
But getting to the very top took time, and was far from automatic despite public outrage over the riches Enron’s bosses pocketed while their company sank.
“The pressure on prosecutors to deliver indictments in real time has grown dramatically,” said Kirby Behre, a former federal prosecutor. “When they rely on the cooperation and testimony of high-level subordinates, there’s a lot out of your control.”