Case Study On The Ethical Violation Of Kenneth Lay

The Ethical Violation of Kenneth Lay

By: Jessica Barnett

Kenneth Lay’s violation was one of the revolting and shameful ethics ever done. Kenneth was the CEO and the chairman of Enron, an energy company. His mistake caused the entire company that he worked for to go bankrupt, and ruined Arthur Andersen, which was a very large audit firm at the time. He was guilty of money laundering, bank fraud, and insider trading.

After he was caught and guilty, he was sentenced up to forty-five years in prison. Kenneth was born on April 15th, 1942. His hometown was Tyrone, Missouri. He also, sadly, died on July 5th, 2006, 10 years ago. He caused over 20,000 Enron employees to lose their jobs and their life savings, and he lost billions of investors.

In 2001,

Lay sold very big amounts of Enron stock in September and October as it’s share price fell. He paid over $300,000,000 from Enron stock from 1989 - 2001. Kenneth Lay was caught playing a role in the company's fails, and was found to have 11 counts in security frauds, wire frauds, and making false and misleading statements.
On May 25, 2006, Kenneth was found guilty on all six counts of frauds and conspiracies. Also, on October 16, 2001, Ken announced a $638,000,000 loss and a $1.2 billion reduction in shareholder equity. Soon after that, securities and exchange commission launches an inquiry into Enron’s finances, and Enron goes bankrupt. When Enron goes bankrupt, all of its workers are laid off, and are forced to find work somewhere else.
On January 23, 2002, Kenneth Lay resigned as chairman and CEO of Enron. After that Ken pretty much just took a break until his trials began in January of 2006.
October 17, 2006, the year that Kenneth Lay died, a federal judge vacates his conviction on fraud conspiracy charges, which made it more difficult for the government to seek $43.5 million dollars from Lay’s estate.
Kenneth Lay actually founded Enron! Anyway, Kenneth Lay’s mistake will always be in my memory for as long as I shall live. I will remember what happened to Enron, and who made them go bankrupt, and how he did it.

If I could go back in time to change what he did, I would first go to him. I would tell him that what he was doing was wrong, and that he would regret it in the future. If he didn’t believe me, I would probably try to tell all of the workers for Enron to get new jobs, because if they didn’t, then they would lose all of their life savings if they stayed.

I feel that Kenneth Lay’s punishment was a lot more than he deserved. I read that someone who worked in court said that he could have had a lot less years in prison.