Integrity
Matters
August 13, 2003
Former
Enron execs aren't free yet
Question: (E-060)
Dear
Jim:
What
next? The Dallas Morning News announces that "Two
Top Enron Executives Escape Indictment." Jeffrey
Skilling continues to spend time with his family, and
Ken Lay is now working at a business start-up. These are
the two men who oversaw the highflying Enron Corporation
and they are denying accountability for the billions squandered.
To make matters even worse, the Justice Department pronounces
itself "very satisfied" with the work of its
Enron Task Force. This task force has secured indictments
of 19 former executives. Is this a justice system with
integrity?
Response:
Take
heart, it is not over for Skilling and Lay -- at least
not yet. Apart from headlines, the investigation continues.
Many students of the law who are observers of the Enron
mess think criminal charges may yet be filed against one
or both of these individuals, and relatively soon. If
the very slow pace of the investigation frustrates you,
you are not alone. About 30 agents of the Federal Bureau
of Investigation have assisted the eight or nine federal
prosecutors who make up the task force of the Justice
Department. They have been working on this case since
January 2002. These kinds of investigations are complicated
and take time.
Progress
is being made: Andrew Fastow, Enron's former chief financial
officer, faces 99 counts ranging from obstruction of justice
to money laundering. Also, as a result of this investigative
process, Enron's auditor, Arthur Andersen, was found guilty
of obstruction of justice in a June 2002 jury trial.
There
are reports that Lay, 61, loomed large in Houston philanthropic
circles and was a top contributor to President Bush's
2000 campaign. Both Skilling and Lay maintain that they
knew nothing about the fraud of Enron.
If
there was fraud, and there is little evidence to deny
gross mismanagement, perhaps criminal intent, by those
leading Enron, and still they say that they knew nothing
about it, then their board should have fired them for
incompetence. If they did have knowledge and are lying,
then the justice system can address appropriate penalties.
If the leaders knew, and the members of the board knew,
and no one blew the whistle, then our federal prisons
system may consider building lots more cells.
So
very much of what makes our country "tick" revolves
around uncomplicated behaviors: We make promises and we
keep them. We go the extra mile when necessary and we
support one another in hard times. We enjoy success and
we avoid excess. We value employees and serve customers.
Leaders own the defeats and failures and pass along to
others the credit for victories.
When
these unwritten rules of management and labor integrity
are broken, our system of checks and balances will rise
up to make things right. Integrity-centered responsibility
reminds each and every participant in the free market
system that we must maintain the proper balance between
legitimate self-interest and social responsibility.
Destructive
and self-serving greed must be regulated.
