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An Enron manual of ethics from July 2000, about a year before the company collapsed. Enron's complex financial statements were confusing to shareholders and analysts. [1]: 6 [10] When speculative business ventures proved disastrous, it used unethical practices to use accounting limitations to misrepresent earnings and modify the balance sheet to indicate favorable performance.
[2] [10] At the time, the price averaged $53.78 per share. [10] This early sell-off of Enron stock had the benefit of shielding Pai from the insider trading charges leveled against other Enron executives who had also secretly sold off large amounts of stock before the company's ruinous finances were publicly known.
Stock Price of Enron from August 2000 to January 2002. As the scandal progressed, Enron share prices decreased from US$90 during the summer of 2000, to just pennies. [51] Enron's demise occurred after the revelation that much of its profit and revenue were the result of deals with special-purpose entities (limited partnerships which it ...
In the long history of financial frauds, Enron ranks near the top of the list, with the once high-flying energy trading company suddenly unraveling in a web of lies and accounting sleight-of-hand.
The energy company's collapse put more than 5,000 people out of work, wiped out more than $2 billion in employee pensions and rendered $60 billion in Enron stock worthless. Its aftershocks were felt throughout the energy sector.
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In the end, of course, their confidence is exposed as blind faith: Enron's stock plunges from $95 to $1 in just 24 days as it becomes clear that the company is little more than a house of cards.
Fastow's approach to hiding losses was so effective that the year before Enron declared bankruptcy, the Enron stock was at an all-time high of $90. As it turned out, the company was already well on its way to financial collapse, to the point that it was all but forced to seek a merger with rival Dynegy. By then, Enron's financial picture had ...