A prequel for students watching "The Smartest Guys in the Room".

1. Instructor: Tom Matys
DPR105: INFO MGMT SYSTEMS

2. Kenneth Lee "Ken" Lay was an
American businessman. He
played a leading role in the
corruption scandal that led to
the downfall of Enron
Corporation.

3. Jeffrey Skilling: CEO Enron
• guilty on one count of conspiracy
• guilty on one count of insider trading
• guilty on five counts of making false
statements to auditors
• guilty on twelve counts of securities fraud
• not guilty on nine counts of insider trading

4. Andy Fastow: CFO Enron
Andy Fastow was one of the key figures
behind the complex web of off-balance-sheet
special purpose entities (limited
partnerships which Enron controlled)
used to conceal their massive losses.
Fastow served a six-year prison sentence
for charges related to these acts.

5. Enron’s Accounting Firm:
The Powers Committee (appointed by Enron's board to look into the firm's
accounting in October 2001) came to the following assessment: "The
evidence available to us suggests that Andersen did not fulfill its
professional responsibilities in connection with its audits of Enron's financial
statements, or its obligation to bring to the attention of Enron's Board (or
the Audit and Compliance Committee) concerns about Enron's internal
contracts over the related-party transactions”. - Wikipedia

6. Deregulation of power and energy
Mark to Marketing
Buy/Sell power/energy stock

7. Claimed future profits as current profits
Shredded evidence
Congress passes SOX
Initially hid profits by moving cash into personal
accounts
Cost 20,000 job losses
20 million in retirement funds were lost.

8. $100 billion in revenue from energy giant Enron
was found to have sustained itself by means of
institutional and systematic accounting fraud