Why Skilling and Lay Were Convicted

Thanks to the candor of several jurors who spoke only moments after reaching their verdict in the huge fraud and conspiracy trial of former Enron executives Kenneth Lay and Jeffrey Skilling, we now have a decent sense of why the two men were convicted of virtuall all of the charges against them in federal court in Houston.

It is not complicated. Several jurors said that they were impressed with and believed the testimony of two former Enron officials, Ben Glisan and Mark Koenig, both of whom pleaded guilty to Enron-related charges of their own and turn state's evidence against their bosses. Glison told jurors that Lay knew about massive problems at Enron and chose to ignore the news. Koenig told jurors that as investor relations chief for Enron he routinely lied about the company's financial health. Neither man's testimony, alone, would have been enough to convict Lay and Skilling. Together, though, their testimony helped weave together a narrative that doomed the defendants.

What also did in Lay and Skilling was their failure to gain any credibility or believability with the jury. One juror told the media that she really "wanted" to believe the two defendants when they testified, under oath, for days on end, but that she simply couldn't. Another said that she believed that the two men had a duty to know what was going on inside their company. They were too smart not to know, the juror said.

This was the big gamble of the whole trial-- whether the decision by the defendants to testify in their own behalf would reap them any benefits with the jury. We now know for sure that the gamble did not pay off. Either Lay and Skilling did not sell their innocence well enough or they did not have enough innocence to sell, even to a group of folks who might have been receptive to it. So don't look for grand conspiracy theories in trying to figure out how this result occured. The jury believed the prosecution's witnesses and didn't believe the defendants. It's not much more complicated than that.

Also, because I read everything you guys write, I have to respond to the post that suggested that these guys won't serve much prison time, if any. Unless today's convictions are reversed on appeal, both men are likely to spend the better part of the rest of their lives in a federal penitentiary. On that you can make book.

By  |  May 25, 2006; 2:43 PM ET
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Comments

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Well, let me be the first to congratulate the prosecution team. At least one public institution in this country is still working. Well done.

Posted by: Tom | May 25, 2006 03:49 PM

And the investigation team - FBI, SEC? - as well.

Posted by: Tom | May 25, 2006 03:53 PM

what are the odds of either man getting a presidential pardon?

Posted by: pat | May 25, 2006 03:59 PM

I found the whole of the defense laughable, since it boiled down to trying to prove that Lay and Skilling were too incompetent to know what was actually occuring at the company they ran or that these former master of the universe were steam rolled by that evil liberal rag the Wall Street Journal. I'm pleased to see that the jurors found them laughable as well.

Posted by: Entprof | May 25, 2006 04:00 PM

I read Conspiracy of Fools about the Enron meltdown. I was worried that the case would be difficult to present and understand. Thanks to all who worked hard to investigate and present a case that could be decided on credibility, and to the jurors who were able to do so.

Posted by: Steve | May 25, 2006 04:18 PM

And one day, when the documents are finally declassified, we'll see Ken Lay and Lee Raymond on the Bush-Cheney Energy Policy Commission. I mean, who could possibly work know more or care more about our country's energy interests than the CEOs of the energy companies, right?

Posted by: SC | May 25, 2006 04:32 PM

Although Skilling and Lay are two of the worst examples of corporate greed, they are surely not the only ones out there. It's time for a total culture change that requires corporations to seek profits, but also maintain a sense of obligation to the larger community. When that happens, we'll really be able to give a sigh of relief. Until then, hold onto your wallet.

Posted by: Steve August | May 25, 2006 04:54 PM

Thank you, jurors. Sometimes justice does prevail. These guys were just too impressed with themselves--sometimes what works in the upper echelons where not many have much practical experience, falls flat when presented to real people who work for a real wage.

Posted by: Dave, Freeport, IL | May 25, 2006 05:43 PM

Despite a damning list of convictions and the overwhelming evidence of guilty before the courts of law and public opinion, these guys will not in all likelihood serve their sentences in full. After appeals and the no-doubt forthcoming executive pardons, Skilling and Lay will walk free after only a few years of incarceration. History shows that the wealthy don't have to pay for their crimes.

Posted by: Lev | May 25, 2006 05:45 PM

I'm afraid I think Lev is correct.It would be nice to believe that these two will serve their sentences, but when Bush leaves office he can pardon anyone he pleases and doesn't have to worry about public opinion or future elections. Don't you think he might well pardon Skilling and Kenny Boy?

Posted by: Felice Sage | May 25, 2006 06:33 PM

"I found the whole of the defense laughable, since it boiled down to trying to prove that Lay and Skilling were too incompetent to know what was actually occuring at the company they ran or that these former master of the universe were steam rolled by that evil liberal rag the Wall Street Journal."

This will also be the central thread of the Bush Administration's defense if and when we ever get real investigations into how the Iraq intelligence was spun and fed to the public. Fittingly, they are also old friends.

Posted by: B2O | May 25, 2006 06:45 PM

"And one day, when the documents are finally declassified, we'll see Ken Lay and Lee Raymond on the Bush-Cheney Energy Policy Commission."

And one day, if the Iran Contra Alumni Employment Network is any indication, we will also see Lay and Skilling as Energy Secretary and Presidential Ethics Adviser in a Jeb Bush Administration. And the mainstream corporate media will be just as politely forgive-and-forget as they have been in reporting on John Negroponte and Otto Reich. They are simply a sight to behold these days.

Posted by: B2O | May 25, 2006 06:52 PM

It's well-known that Kenny-Boy and friends were major donors to Bush's campaigns.

What's less widely known is what Enron bought with this money. It was only after the Enron scandal broke -- and Enron became too hot to touch -- that Bush administration began distancing itself, and "Kenny Boy" suddenly became "Ken who?"

For a review of favors lavished on Enron behind-the-scenes, see http://www.consortiumnews.com/2006/052506.html

One more glimpse of daily life into this government of the rich, by the rich and for the rich.

Posted by: avi | May 25, 2006 10:27 PM

Might the death penalty for really, really, really serious white collar crimes serve as a deterrent? How about a cost/benefit analysis and comparison of current capital crimes with these serious white collar crimes?

Posted by: Shag from Brookline | May 26, 2006 06:04 AM

Bush could pardon Lay and Skilling as he leaves office, but that would present a public-perception catastrophe for the Republican party.

Posted by: Dave, Freeport, Il | May 26, 2006 07:20 AM

Yee-haw, one day of reckoning down. We need a few more.

Posted by: Sara B. | May 26, 2006 08:42 AM

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