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Kenneth Lay, former CEO and chairman of Enron Corporation, was indicted for his role in the collapse of the energy trading giant on July 7, 2004. It was claimed that Enron had used off-the-books deals to hide billions of dollars in debt and to inflate profits. Though the grand jury indictment was sealed, sources reported that SEC charges ranged from securities law violations, to financial fraud and insider trading stemming from stock-related transactions Lay allegedly had engaged in months before Enron Corporation's spectacular meltdown in December 2001. Lay has denied all charges.
Lay was born on April 15, 1942. He studied economics, receiving his bachelor of arts and master's degrees from the University of Missouri, and a PhD from the University of Houston, in 1970. Lay was a naval officer in the Pentagon before becoming an aide to a federal government regulator for the natural gas industry. He then moved to the private sector and worked his way up in the natural gas industry. In 1984, he became CEO of Houston Natural Gas, a big regional pipeline operator. He engineered its merger with Internorth, an Omaha pipeline company, and became CEO of the combined company, which changed its name to Enron. Lay quit as CEO in February, 2001, in favor of protege Jeffrey Skilling and returned as CEO six months later, when Skilling quit. Chairman of the Board from the time of Enron's inception, Lay resigned from that position on January 23, 2002, just as the Senate Commerce Committee issued a subpoena to compel his testimony. He quit the board altogether 10 days later. He would later refuse to testify before the committee, citing his rights under the Fifth Amendment.
While never a very public figure, Lay was known as a risk taker and as a proponent of free markets. A personal friend of President George W. Bush, he was one of his top fundraisers. These connections gave him tremendous power not just in business, but also in Texas politics, and in the politics in other state capitals, where Enron took the lead in lobbying for energy deregulation. In Houston, Lay was prominent in civic and charitable causes, and the ballpark was named for his company. At the time of its collapse, in the final months of 2001, Enron was the nation's seventh largest publicly-owned firm.
Lay died of a heart attack on July 5, 2006.
Last updated: July 06, 2006.
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