HOUSTON – A federal jury began deliberating Thursday on the fate of Arthur Andersen LLP, the disintegrating accounting firm charged with obstruction of justice for shredding Enron Corp.-related material.
If convicted, Andersen would face fines and would be barred from auditing public companies, a major part of its business. More than 650 of its 2,300 clients already have fired the firm, most since the indictment was unsealed March 14.
"We're fighting for our dignity," said C.E. Andrews, managing partner for Andersen's global audit practice. "That's why we're here."
The only early word from jurors Thursday was a request for extra copies of their 15-page instruction and for office supplies such as pens, highlighters and sticky notes. They went home for the night without reaching a verdict.
As its business has withered, Andersen has been selling assets piece by piece, with many of its former employees joining other firms that bought the segments. Andersen also has laid off workers nationwide.
"The Justice Department killed this company," defense attorney Rusty Hardin said.
Closing arguments didn't cease until after nightfall Wednesday and after each side used its full four hours for summations.
Prosecutors contend at least four Andersen partners subtly orchestrated the destruction of thousands of Enron-related documents, fearing a Securities and Exchange Commission investigation into the energy trader could turn against its longtime auditor.
Defense attorneys countered that the destruction occurred under the firm's document retention policy, which calls for the elimination of extraneous material, and was not intended to hide anything from the government.
Enron filed for bankruptcy Dec. 2 amid a maze of alleged accounting abuses. The energy trader's downward spiral began with the mid-October report of a $618 million third-quarter loss and a $1.2 billion writedown in shareholder equity. It was later revealed that financial partnerships helped the company hide debt and inflate profits.