HOUSTON – The trial of former Enron Chairman Ken Lay and former Chief Executive Officer Jeffrey Skilling begins on Monday.
The following is a breakdown of the criminal charges facing the two men:
KEN LAY (seven charges)
—CONSPIRACY TO COMMIT SECURITIES AMD WIRE FRAUD: Contends that after resuming the position as chief executive officer after Skilling's sudden resignation in August 2001, Lay lied to employees, accounting firm Arthur Andersen, analysts and credit rating agencies about Enron's financial health.
—WIRE FRAUD (2 counts): Lay's use of electronic transmissions for internal meetings in which he falsely told employees that Enron would reach its profit targets.
—SECURITIES FRAUD (4 counts): False statements made during four conversations with analysts and a credit rating agency hiding the dismal nature of the company's finances.
—OTHER CHARGES TO BE TRIED AT LATER DATE: One count of bank fraud and three counts of false statements to banks for using proceeds from personal bank loans totaling as much as $75 million to buy on margin Enron stock worth more than the total loan amounts.
JEFFREY SKILLING (31 charges)
—CONSPIRACY TO COMMIT SECURITIES AND WIRE FRAUD: Filing erroneous quarterly and annual reports to the U.S. Securities and Exchange Commission, lying to analysts.
—SECURITIES FRAUD (14 counts): For employing fraudulent financial schemes, filing of five bogus quarterly and two year-end SEC reports, and six presentations to analysts
—FRAUD THROUGH FALSE STATEMENTS TO AUDITORS IN ANNUAL AND QUARTERLY REPRESENTATION LETTERS (6 counts): Misrepresenting Enron's 2000 and 2001 financial statements to auditors as true.
—INSIDER TRADING (10 counts): Sales of more than 1.1 million Enron shares yielding nearly $63 million from April 2000 to September 2001 while possessing information not known to the public.