Post #256,847
5/25/06 12:26:47 PM
|
Do not pass Go, do not collect $200
...After all, you've already skimmed millions. Enron former chief executive Jeffrey Skilling and founder Kenneth Lay were found guilty today of conspiracy and fraud in the granddaddy of all corporate fraud cases
On the sixth day of deliberations, a jury of eight women and four men convicted the former executives of misleading the public about the true financial health of Enron, the giant energy company that collapsed in late 2001.
...
Both Lay and Skilling could face 20 to 30 years in prison, legal experts say. [link|http://money.cnn.com/2006/05/25/news/newsmakers/enron_verdict/index.htm?cnn=yes|http://money.cnn.com...index.htm?cnn=yes] -YendorMike
"They that can give up essential liberty to obtain a little temporary safety deserve neither liberty nor safety."
- Benjamin Franklin, 1759 Historical Review of Pennsylvania
|
Post #256,848
5/25/06 12:37:10 PM
|
YES!
This leads one to believe that there actually is justice in the world today.
lincoln
"Chicago to my mind was the only place to be. ... I above all liked the city because it was filled with people all a-bustle, and the clatter of hooves and carriages, and with delivery wagons and drays and peddlers and the boom and clank of freight trains. And when those black clouds came sailing in from the west, pouring thunderstorms upon us so that you couldn't hear the cries or curses of humankind, I liked that best of all. Chicago could stand up to the worst God had to offer. I understood why it was built--a place for trade, of course, with railroads and ships and so on, but mostly to give all of us a magnitude of defiance that is not provided by one house on the plains. And the plains is where those storms come from." -- E.L. Doctorow
Never apply a Star Trek solution to a Babylon 5 problem.
I am not merely a "consumer" or a "taxpayer". I am a Citizen of the United States.
[link|mailto:bconnors@ev1.net|contact me]
|
Post #256,851
5/25/06 12:48:34 PM
|
Ditto....
I actually have to get Pres. Bush credit for putting Lay and Skilling on trial and getting a conviction.
|
Post #256,852
5/25/06 12:49:23 PM
|
Don't count your chickens just yet.
I'm sure there will be appeals, and I wouldn't be surprised if they develop some strange disease and claim that they are too sick to serve their sentences. :-/
But, yes, it is good news that they were convicted. I just think it may be 5 years before they begin to serve any sentence.
Cheers,
Scott.
|
Post #256,855
5/25/06 1:47:00 PM
|
Nope...too short.
No, I'm [link|http://www.washingtonpost.com/wp-dyn/content/article/2006/05/25/AR2006052500438.html|not] kidding.
|
Post #256,856
5/25/06 1:51:40 PM
|
!
|
Post #256,864
5/25/06 2:53:37 PM
|
That's a mistake
I give him 18 months - max - until he offends again.
Castration should be an option however.
[link|http://www.blackbagops.net|Black Bag Operations Log]
[link|http://www.objectiveclips.com|Artificial Intelligence]
[link|http://www.badpage.info/seaside/html|Scrutinizer]
|
Post #256,859
5/25/06 2:06:12 PM
|
How long until he moves?
He'll have to register as a sexual predator. This is probably all over the local news in his small town. (I'm assuming it's small, this is Nebraska.) Everyone will know.
===
Purveyor of Doc Hope's [link|http://DocHope.com|fresh-baked dog biscuits and pet treats].
[link|http://DocHope.com|http://DocHope.com]
|
Post #256,850
5/25/06 12:48:16 PM
|
I've been thinking about this case
Everyone seems to agree that it's not fair that some people lost their life savings when the Enron stock tanked. So why is it fair that some people made a ton of money by getting out before that happened? I mean regular outside investors playing the stock market, not the insiders guilty of fraud.
A lot of the money that Lay and Skilling made was salary. That came from what should -- if stocks worked properly -- have been dividends. But most of the money lost by investors was in decreased share price. The only people who lost [link|http://www.ecotao.com/holism/add/enron/Enron.html|over $90 per share] are the people who bought at the top. People who bought at $20 per share only lost that initial investment -- or however much they couldn't dump before it went below $20. But even that loss wasn't to Enron, it was to whoever they bought the stock from.
I started thinking about this when I heard someone on the radio saying Lay and Skilling should be forced to repay all the money investors lost. The thing is, most of the money that people lost, they lost to other investors.
If you sell a bunch of jewelry to a pawn shop, and it turns out to be stolen, the jewelry is returned to the owner. The pawn shop owner is out however much money he paid, even if he didn't knowingly do anything wrong. Why don't stocks work the same way?
===
Purveyor of Doc Hope's [link|http://DocHope.com|fresh-baked dog biscuits and pet treats].
[link|http://DocHope.com|http://DocHope.com]
|
Post #256,857
5/25/06 2:03:23 PM
|
Are we talking about the employees?
'Cause as I understand it, while the execs were pushing the company stock as _the_ investment to hold, they were not only dumping there's in the background, but the "regular folk" were also locked out from selling their shares.
Stuck holding the bag (o' shite), I believe is how it is described.
thanks,
mx.
"I'm man enough to tell you that I can't put my finger on
exactly what my philosophy is now, but I'm flexible."
-- Malcolm X
|
Post #256,860
5/25/06 2:11:12 PM
|
Yes, they're the ones most likely to have lost everything
But unless company execs held more than 50% of the stock, which I believe is unlikely, then most of the money made on the runup was not made by insiders. For every employee who lost money, there were probably lots of non-employee investors who made money.
Investing your entire life savings into one stock is never a good idea. It sucks that so many people only learn this the hard way, if they learn it at all. If I wanted to be a heartless prick I would say that all those now-broke employees were stupid to put themselves in that position.
===
Purveyor of Doc Hope's [link|http://DocHope.com|fresh-baked dog biscuits and pet treats].
[link|http://DocHope.com|http://DocHope.com]
|
Post #256,865
5/25/06 2:56:05 PM
|
I don't believe they put themselves in that position
I seem to recall that their pension fund managers put them in that position, investing very high percentages of the pension funds in enron stock.
So they're the victims here.
[link|http://www.blackbagops.net|Black Bag Operations Log]
[link|http://www.objectiveclips.com|Artificial Intelligence]
[link|http://www.badpage.info/seaside/html|Scrutinizer]
|
Post #256,869
5/25/06 3:33:16 PM
|
Curious
So why does everyone keep saying Lay was encouraging employees to put their money into Enron stock? If they didn't have a choice, why was he doing that?
===
Purveyor of Doc Hope's [link|http://DocHope.com|fresh-baked dog biscuits and pet treats].
[link|http://DocHope.com|http://DocHope.com]
|
Post #256,872
5/25/06 3:48:51 PM
|
Contemporary article about Enron's 401k.
[link|http://www.cfo.com/article.cfm/3002308/c_2984379/?f=archives|CFO.com]: The suit alleges that Enron "locked down" 401(k) accounts on October 17, preventing employees from changing the investments they held in their accounts until November 19.
During that period Enron reported its first quarterly loss in four years and took a $1.2 billion charge relating to off-balance-sheet deals that are now being investigated by the Securities and Exchange Commission.
Enron's stock plunged from $30.72 at the close of trading October 16 to $11.69 on November 19.
Enron spokeswoman Karen Denne said that employees' access to their accounts was blocked from October 26 to November 19 due to a previously planned change in the administration of the retirement plan, according to published accounts.
Lacey, 45, who has worked for Portland General Electric for 21 years, told wire services that the freeze on retirement account actions came while bad news about Enron was seemingly being released daily. "We couldn't take our money out of Enron stock into another portfolio. Basically they had us locked down to where we had no say over our own future," he told wire services.
Before Enron's share price took a nosedive, Rinard had $472,000 in his 401(k) plan. He says his plan is currently worth just $40,000.
Enron matches employees' 401(k) contributions with company stock. Many Enron employees, including Rinard, put their entire retirement account into Enron stock when Enron executives predicted that the stock would rise above $100 a share, Rinard told the Houston Chronicle.
The lawsuit is reportedly being patterned after a case brought by employees against Lucent Technologies last summer concerning matching 401(k) contributions with company stock. As with Enron, the share price of Lucent has also dropped dramatically over the past year. Yes, it's dangerous to have all (or even most) of your retirement locked up in your company stock no matter how well it is performing at the moment. If the company tanks, you'll be out of your job and lose your retirement savings. Enron (and apparently Lucent, according to the story) did more than just encourage employees to buy their stock - they prevented them from getting out in an attempt to prop up the stock. If that wasn't a scheduled, routine blank-out period, then the managers should be charged with stock manipulation (or something). I don't think Enron's shareholders should be "made whole" (even if that were possible, which it isn't). I do think that fraud, deceptive practices, etc., should be punished and the people responsible should be liable for reasonable and fair civil penalties (not that any Enron shareholder class would collect much of anything if they're successful). FWIW. Cheers, Scott.
|
Post #256,874
5/25/06 4:00:43 PM
|
I hadn't heard about the lockout
I guess the timing was that they were encouraged to get in, then once they had, they weren't able to get out. I'd love to see a memo come out that shows the execs talking about the lockout before they made the encouraging statements.
===
Purveyor of Doc Hope's [link|http://DocHope.com|fresh-baked dog biscuits and pet treats].
[link|http://DocHope.com|http://DocHope.com]
|
Post #256,862
5/25/06 2:18:35 PM
|
There is a bit of whining
There is a bit of whining in this case from people who simply lost money in an investment shift. But the critical factor was that Enron was lying about how well the company was doing, right up until the company fell apart.
Quite simply, if you bought something because of a fake description of it's quality, it doesn't matter if the person that gave you the fake description was directly making money off the deception. The important thing is if they knew the description was false.
And the Enron executives where in fact making money directly off the stock, because they owned so much themselves. What angers people most about Enron is that those executives where out in public saying everything is fine while dumping every share of their own Enron stock they could.
And there is another group that was even more directly harmed by Enron. The Enron employees who where heavily invested in Enron because of the way their retirement system was setup. At the same time as the top tier was selling their own shares they where working to prevent the regular employees from doing the same.
Jay
|
