Ah, Enron. The good ole days when fraudulent execs still went to jail and corporations still saw consequences of fraud.
2002, Arthur Andersen gets indicted for deliberately aiding Enron in cooking the books. 2003, Bush DoJ's attorney general binds prosecutors to effectively always settle corporate cases without convictions. So nowadays you have companies like Boeing murdering 300+ without real consequences. It's a real shame.
> The good ole days when fraudulent execs still went to jail
Well, not one guy. Lou Pai cheated on his wife with stripper Melanie Fewell who was also married. He was known in the Enron offices to enjoy Houston area strip clubs. But in a first for him, he knocked Melanie up over the course of the affair. Pai's first wife and mother of his first two children Lana Lee learned about it and started divorce proceedings. To satisfy asset division as part of their divorce terms, Pai sold $250M worth of Enron stock just months before it crashed and Enron went bankrupt. Pai then married Fewell. Pai was briefly the largest(? maybe top two?) private land owners in Colorado, and his ranchland included Culebra Peak, one of CO's 14ers.
In 2008 he settled a civil suit alleging insider trading brought by the SEC. The settlement was $31.5 and does not include an admission of the SEC's claims. He was barred from serving as an officer or director of a public company for 5 years.
Lou landed on his feet. He and Melanie are still married. They and their daughter seem to be big figures in dressage, running Canaan Ranch and the Bred in the USA Syndicate, which seems to be a syndicate of 14 breeders. Maybe someone who knows horses can explain exactly how big a deal they are; they might not be much after all.
https://www.usef.org/us-equestrian-teams/athletes/natalie_pa...
Lou Pai is an American role model, I love that he used divorce as a tool as the breadwinner. It is advertised as a failure mode, societally, and doubly so for the person that accumulated assets. Helped me realize to take a second look at the system at the level lawyers operate at
SEC only went after him because the movie came out
I think our current commissioner was working at the SEC at that time, I wonder what he thinks of it
You gotta think that maybe he was playing chess, not checkers, when he conceived his daughter. The perfect way out.
He was having sex with strippers in the club's VIP, a feature that's often denied as existing, meeting more visually and sexually attractive, younger, more feminine women in that route, with a nice bankroll.
The utility of his prior lifestyle had diminished, he didn't need a dual income household and he certainly didn't want it.
He was bored of it, the university pipeline straight to running a corporate VC arm full of corporate climbers that want to prove how they fit in male dominated spaces with masculine behaviors. The representation of that was and is completely contrived - for any guy with options - and he went along with it because people told him to in the DC area, and that's who his peers were. Assortative mating that he realized was not serving him and he wasn't poor enough to need it.
I wouldn't say the conception was planned, he was just having fun with his favorite stripper, but pouring gas on himself at the gas station to mask her sent was.
Now, he retired his whole bloodline, after making a bloodline at all with his favorite stripper, giving her the dream of ponies, horses, and seemingly living happily ever after. I never followed up on his daughter being an adult now, but the privilege of pursuing dressage because of the father's successful indiscretions is fascinating.
I'll definitely aim to replicate, it looks far more appealing than upper middle class assortative mating does, with all the failure modes reappropriated as exception handling. I'll just avoid the first marriage, and refine the journey with trusts more effectively in such a wild wealth disparity and power dynamic, but also keep the divorce court ordered insider trading immunity in my back pocket.
No, Bush's AG did not bind prosecutors to effectively always settle corporate cases without convictions. Following high-profile corporate scandals (e.g., Enron, WorldCom, Tyco), Bush established the Corporate Fraud Task Force in 2002. Over the next couple of years the DOJ obtained over 500 corporate fraud convictions or guilty pleas. They charged over 900 defendants and over 60 corporate CEOs and presidents with some type of corporate fraud crime in connection with over 400 filed cases.
https://www.justice.gov/archive/opa/pr/2004/July/04_dag_495....
Certainly what it feels like... but you've got: SBF, Holmes, Madoff who have done and are doing prison time. But yea, the Boeing case stands out for sure.
> SBF, Holmes, Madoff
The difference here is that they defrauded the investor class.
A company I had private stock in just sold. The email I got saying that they wanted to get me paid ASAP was electric. Finally, for just a day or two, I was in the elite of the elite: people who are owed money and that the enforcement arm of the US government will ensure are made whole. The payday was under $100, but the feeling was priceless.
And, with at least two of them, people knew what was going on and were perfectly happy to let the fraud continue until their hands were forced.
touche!
> the investor class
Too nice of a way to talk about the Epstein class.
On top of defrauding the investor class as others mentioned, they had already completely lost their power at that point. So it was just taking down someone who was already down. Their companies/funds were dead already.
If Arthur Andersen hadn't been indicted, it's possible it would have continued as a company and gotten away with it, at the very least much more likely than the above three.
I remember when Arthur Andersen Consulting (a software consulting firm that had split off from the accounting firm) renamed itself to "Accenture" in 2001 a few months before the Enron scandal. Although they already had split from Andersen legally, I wonder if somebody in the software firm knew what was going to happen with Enron and realized they needed to dissociate themselves with the name.
Nothing important to rich people and their money ever really goes away.
https://www.reddit.com/r/Superstonk/comments/10ir695/nomura_...
Yes, yes, I know, ctrl-f Credit Suisse and pretend it's 2005 and some crank with a tin foil ball cap is telling you about the NSA's wiretap program (with 2020 hindsight). No one ever talks about the 2019 bailouts.
> always settle corporate cases without convictions
I'm not sure that's a bad idea. You can't put a corporation in jail, but you can get their money and that also requires a lower standard of proof than a criminal conviction. In theory I could see it as a better way to recover restitution for those who suffered losses.
>You can't put a corporation in jail
I don't see why we can't just put an entire board of a company in jail. Might inspire them to do better.