Skilling gets 24 years Jail term for his Greed

Jeffrey Skilling, the former CEO of Enron Corporation, who was convicted of federal felony charges relating to Enron's financial collapse, on Monday, was sentenced to 24 years and 4 months in prison.

A jury, yesterday in its verdict found Skilling’s active role in the fraud, insider trading, and conspiracy that destroyed the once high-flying U.S. energy-trading and utilities company, Enron, which now houses one of the biggest accounting frauds in history.

Skilling, 52, known for his arrogance and harsh attitude, on May 25 was found guilty of 19 out of 28 counts against him, including one count of conspiracy, one count of insider trading (although he was acquitted of the other nine counts of this particular charge), five counts of making false statements to auditors, and twelve counts of securities fraud.

His co-defendant, now-deceased, ex Enron CEO Kenneth Lay was also convicted on conspiracy, securities fraud and wire fraud charges. Lay, 64 faced a prison sentence of up to 30 years but died of heart disease in July, a few weeks after being convicted.

After the announcement of his sentence, Skilling put his arm around his lawyer, Daniel Petrocelli, then sat down and turned to give his sobbing wife, Rebecca Carter, a former vice president for board communications and board secretary at Enron, a weak smile across the courtroom.

"I am innocent of the charges," Skilling had told U.S. District Judge Sim Lake. "I am innocent of every one of these charges."

The imprisonment of Skilling is the most severe punishment given to any Enron exec, however, it falls just one year short of the 25-year term handed to the former CEO of Worldcom, Bernie Ebbers, for his role in the $11 billion fraud which led to that company’s collapse.

Skilling, who in one decade converted Enron from a drowsy pipeline company into an energy-trading juggernaut, is also responsible for the destruction and bankruptcy of the company that cost thousands of jobs and more than $2 billion in employee pension plans. Subsequent probes disclosed that Enron had inflated its earnings by hiding its debt and losses in subsidiary partnerships.

Accounting schemes the former CEO approved enshrouded huge debt and cash flow difficulties at the company that led to its ultimate extinction. Shareholders at Enron, once the nation’s seventh-largest company, lost billions of dollars in stock and retirement savings.

“As the many victims have testified, his crimes have imposed on hundreds if not thousands a life sentence of poverty,” Judge Lake said.

Meanwhile, Skilling’s lawyers have started to prepare his appeal against the 19-count conviction, leaving legal experts warning that the Enron saga that began with the group's 2001 fall from once graded America's Most Innovative Company to the biggest bankruptcy in U.S. history, is not over.

"The book is not closing on Enron. It is only the end of a chapter,'' said Jacob Frenkel, a white-collar crimes lawyer.

Before reading the harsh sentence on Skilling, Judge Lake listened to the outrage of people who lost retirement savings, jobs and investments with the collapse of Enron's $60bn market capitalization. A 22-year Enron employee called Skilling "a liar, a thief and a drunk" who showed off "an attitude above the law."

Stuck with the harsh sentencing guidelines Judge Lake also approved Skilling's payment of $45m for those who lost money in Enron's pension funds.

The judge could slash his jail term by 54 days a year for good behavior. Furthermore, Skilling could cut one more year for participating in an inmate drug and alcohol treatment program, which the judge required.