Tuesday, Jun 28, 2016
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Justice denied

THE legal system may technically quash the jury verdict against Ken Lay, but the unexpected death of the former Enron chairman cannot expunge a judgment of guilt in the court of public opinion.

Lay, who died of a heart attack Wednesday, is, and always will be, a symbol of corporate malfeasance for his leading role in the bankruptcy of what once was one of this country's leading energy concerns.

In at least one respect, his untimely passing amounts to justice denied. Lots of people wanted to see Lay go to prison, even at the age of 64, because he so richly deserved it.

While legal experts contend that Lay's death before sentencing in federal court effectively nullifies the May 25 verdict, even such an anomaly of jurisprudence cannot change the cold, hard facts.

Lay was convicted, with former Enron CEO Jeffrey Skilling, of masterminding a pervasive fraud that destroyed the company in 2001, taking with it 4,000 jobs and billions of dollars in stock value and retirement savings.

The jury found Lay guilty of six counts of fraud and conspiracy, and he was convicted separately by a judge of fraud and lying to banks in regard to his personal finances. His crimes included deceiving Enron stockholders, its employees, and the public, claiming that the company's financial condition was fine while quietly selling off $70 million of his own stock.

In truth, Enron was a house of cards built on complex financial deals that were shaky at best and illegal at worst. And there is little doubt, least of all reasonable doubt, that Lay knew precisely what was going on as the whole enterprise crumbled. Trusting workers lost their life savings, but Lay arrogantly insisted - literally to the end - that he had done nothing wrong.

Such egregious betrayal is what will make Lay an enduring symbol of corporate malfeasance. The fact that Enron's demise preceded a string of similar misdealings - WorldCom, Tyco International, HealthSouth, and others - only accentuates the lasting damage to the integrity of American business.

Lay was a big man in his hometown of Houston, generously donating millions to such civic causes as the YMCA, the NAACP, and the arts. He also was a major player in Republican circles nationally, one of George W. Bush's most important political patrons and the recipient of a playful presidential nickname, "Kenny Boy."

But when he died, the White House's initial reaction was simply that Lay had been "an acquaintance" of the President, one of many.

As one observer told the Los Angeles Times, "His career was like a Greek tragedy. He started from nothing and became so successful. But as the Greeks taught long ago, hubris brings down the strongest."

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