If Enron is any indication, we’ll be hearing about the collapsed businesses of the financial crisis for years to come. The Enron bankruptcy seems like eons ago, but the fallout never ends.
The company went from a source of pride for Houstonians to the cause of traffic nightmares as the television camera rolled in to town in late 2001 to chronicle the disintegration of the company and countless 401Ks. Seven years ago Friday the big Enron E sold for $44,000.00. In May 2006 former CEOs Ken Lay and Jeff Skilling were convicted of conspiracy and fraud charges. Lay died a couple of months later, shortly before he was to report to prison.
It took until 2007 and millions of dollars for some Enron’s outside counsel to rid itself of potential malpractice claims. Skilling remains in prison, but has asked the Supreme Court to consider his conviction in May of this year, arguing the relevant fraud statutes where incorrectly applied and that a fair trial was not possible in Houston.
And, speaking of Houston, the Federal Court building that welcomed Lay and Skilling for their nearly four month trial sentenced another former chief executive just today.
Ex-Enron broadband exec gets 16 months in prison
HOUSTON (AP) — The former chief executive of the failed Internet division of the former energy giant Enron Corp. has been sentenced to 16 months in prison.
A federal judge sentenced Joseph Hirko in Houston on Monday. Hirko also has agreed to pay $8.7 million in restitution as part of a plea deal with federal prosecutors.
Prosecutors say Hirko falsely promoted Enron’s broadband division to analysts to help pump up the company’s stock price. Hirko admitted that he knew the broadband operating system couldn’t do what it had been promoted to do.
Enron was once the seventh-largest U.S. company. It collapsed into bankruptcy in December 2001 after years of accounting tricks could no longer hide billions of dollars in debt nor make failing ventures appear profitable.
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