Lay's Likely Defense: "Got Rich By Being Genetically Stupid and Now I've Found Jesus"
Want "visibility" into Lay's likely defense against all those thoughtless charges brought by prying congressmen, prosecutors, SEC lawyers, and plaintiffs' attorneys? Here's one template:
Son and Sister of Enron Chief Secured Deals
NYT Feb. 2
nytimes.com
Excerpts (rearranged for brevity):
Acorns Don't Fall Far From the Tree
"The sister and a son of Kenneth L. Lay, the former chairman and chief executive of the Enron Corporation, benefited from extensive business dealings with Enron, according to public records and interviews with family members and people close to the Lays."
"Mark Lay left a low-level position at Enron in 1992, went to work at an energy trading company and then struck out on his own in 1994. After that, the records show, three successive small companies he owned or worked for did business with Enron."
What luck! Enron Scoured the Earth's 5 Billion People and Just Happened to Find the Best Vendors for Those Multi-Million Deals Right Here, in Ken Lay's Family
"The ties included Enron contracts with companies controlled by Lay family members and investments in companies in which family members had substantial holdings."
"Mark Lay and Sharon Lay said that nothing improper took place in any of the transactions. All required disclosures on Enron's dealings with family members were made, they said, adding that Kenneth Lay did not use his influence to award Enron contracts to companies with family ties. Enron declined to comment, and Kenneth Lay and his lawyer did not return phone calls."
Uh-oh. Afoul of the Law
"They charged the R&C management team, including Mark Lay, with embezzling more than $1 million.
"They were hiding assets and stealing assets," said Cindy Scarbrough, an accountant who followed the case with her father, one of the early investors in R&C. "They had all these partnerships and shell corporations, and they would charge transportation costs that were way above normal."
The Defense
"I walked into a snake's nest," the younger Mr. Lay said in an interview this week, describing the business affairs that led to the criminal investigation. "I trusted the wrong people and ended up in a transaction that everybody decided was wrong."
"Mark Lay said that he was not involved in the scheme, insisting that his partners in the R&C venture manipulated him and stole the profits. People who worked with Mark Lay said that the lawyers arrayed against R&C focused on him in the litigation because he was the son of the wealthy chairman of Enron."
"I was just 25 years old," Mr. Lay said, "and I trusted the wrong people." Like Mr. Lay, several of his associates in R&C paid to settle civil litigation without acknowledging wrongdoing."
The Defenders
"Mr. Lay said his father was "supportive" throughout the episode; it was on his father's advice, for example, that he hired a lawyer from Vinson & Elkins, the law firm that represents Enron."
The Sentence
Last year, after serving as president of Enron Investment Partners, a unit of Enron that invested in minority-owned businesses in the Houston area, he enrolled at the Southwestern Baptist Theological Seminary in Houston.
"I think God impressed on me that's where he wanted me," Mr. Lay said. |
