Yesterday the former chairman of Enron, Ken Lay, passed away. Even though Lay himself was an alumnus of Mizzou and I was attending the university while the Enron scandal broke out, I myself never cared about it until about a year ago when I did a
little bit of reading on the matter, and learned that the scandal went far beyond securities fraud and cooking books.
If there is a tragic figure somewhere in all this, it must be Lay. No, I'm not going to excuse the man for his deeds- after all, he was captain of the ship and certainly knew about the scandal as it was taking place. He even cashed some $300 million worth of stock options before the crash. He should definitely take the blame. It is certainly a shame that he will never live through the kind of ruin that thousands of Enron stockholders and employees experienced and are still experiencing to this day.
My opinion of Kenny-boy:Ken's major flaw was that he was far more interested in the perks (luxury homes, personal jets, exotic cars, etc) than running a multi-billion-dollar corporation. Because of this, he let his underlings do his work for him. He ended up in a position where he couldn't say no to people like CEO Jeff Skilling and CFO Andy Fastow, since he knew very little and was no longer in control of the company. The cleverness of Fastow's accounting/book-cooking to keep Enron's debts off their books was far too complicated for Ken to understand. So instead of asking questions, he just signed off on them.
Though the tragic figure is Ken, the victims here are the employees. Enron's 401k plan only matched employee's contributions with Enron stock that would be restricted until they turned 50. In other words, it forced many employees to place their retirement savings entirely in Enron, rather than be allowed to conservatively diversify their portfolio. On the other hand, Enron's upper management was enrolled in a different retirement plan, which allowed many execs to dump their stock at will. Sadly, because of securities fraud and stock-locking due to management switching 401k administrators at "convenient times", employees were locked into their investments until it was too late.
Sadly, this resulted in nearly 20,000 employees who helplessly watched their retirement savings fall from $90 a share to just pennies in a matter of weeks, and they could do nothing about it. It almost seems as though Enron was engineered to fail and destroy many futures from the very beginning.
So this begs the question: is it still possible for employees to seek civil action and receive some compensation from the Lay estate?
According to the
Wall Street Journal Blog, Lay's death might cause his conviction to be expunged- everything associated with his case is extinguished as if he was never indicted or convicted.
Regardless, civil claimants can't seek punitive damages from deceased defendants.
So the answer is no.
Don't expect any real sympathies from Lay's family either. His wife had played a role in dumping stock, as well as
shifting millions in personal assets to investments that are beyond the reach of creditors or legal judgments, just before tearfully telling national television audiences that she and her husband were struggling to avoid personal bankruptcy.
Ken Lay's death is just another sobering reminder that life isn't fair. Many live through their lives being selfish, uncaring and lucky enough to succeed, while the rest of the world works hard, shares, or dies in poverty. Though Ken himself is no longer alive to enjoy the benefits at many others' expense, his family is, and they are immune to the repercussions. His conviction will disappear from the record- possibly the history books, and he will never see the inside of a jail cell. Yes, life isn't fair.
But I rest assured knowing, deep down, that God is.