Daily Archives: April 4, 2006

Charting Lay-Skilling

Posted on by
1

LaySkilling6H.jpgIn connection with this NY Times/Alexei Barrionuevo and Kurt Eichenwald article on the upcoming testimony of former key Enron executives Ken Lay and Jeff Skilling, the Times provides this handy chart of the government’s core allegations in the trial.
The chart underscores the point made earlier here and here on why the Enron Task Force does not want the Lay-Skilling jury to see the indictment against Lay and Skilling, and does not want the Lay-Skilling defense team to be allowed to question witnesses about it — a substantial number of the allegations that the prosecution has elicited from its witnesses to date are simply not in either the indictment or statements in compliance that the prosecution filed against Lay and Skilling.
Moreover, the chart also underscores the Task Force’s slimmed down case (just half a dozen key witnesses) and — despite the conventional wisdom — that the limited areas of alleged wrongdoing make this an eminently defensible case for Lay and Skilling.

When even Tiger can’t help

Posted on by
Reply

tigerbuick.jpgThe Enronesque experience of General Motors has been a common topic on this blog, but you know it’s gotten bad for the automaker when even Tiger Woods’s endorsement appeal cannot bolster one of the company’s brands. This John O’Dell/LA Times article reports about the slide into oblivion of GM’s Buick brand:

Buick was the seed from which General Motors Corp. sprouted. And for generations, the luxury car line was one of GM’s most bountiful divisions.
The Buick brand filled a crucial niche for the auto giant, attracting well-heeled consumers who wanted more than an Oldsmobile but weren’t comfortable with the flash of a Cadillac.
Now as GM faces the threat of bankruptcy, Buick has emerged as an emblem of the auto giant’s broader woes. GM sold nearly a million Buicks in the U.S. in 1984. By last year, sales had sputtered to 282,288, a 70% decline over two decades, the biggest of any major auto brand.
Buick has broken down in U.S. showrooms for the same reasons that Americans deserted GM brands such as Chevrolet, Pontiac and Olds in favor of Toyota, Honda and Nissan. [. . .] Even using golf superstar Tiger Woods as pitchman hasn’t helped Buick. [. . .]

Continue reading →

Former Westar executives sentenced

Posted on by
Reply

westar4.jpgAlthough overshadowed by the Lay-Skilling trial, former Westar Energy, Inc. CEO David Wittig and his corporate right hand man Douglas Lake were sentenced yesterday to 18 and 15 years in prison after being convicted last year of looting the utility of millions of dollars in unapproved compensation. An earlier contentious trial of the two former executives had ended in a mistrial in late 2004 after another federal jury in 2003 convicted Mr. Wittig of bank fraud charges in a case that was not directly related to Westar. Federal prosecutors had sought life sentences against the 50 year-old Wittig and the 55 year-old Lake.
Wittig and Lake each faced charges relating to allegations they looted the largest electric utility in Kansas after the pair left Westar late in 2002 amidst allegations of misuse of corporate funds. Subsequently, Westar under Mr. Wittig was implicated in the scandal surrounding efforts to fund Houston Congressman Tom DeLay’s political action committee. Westar’s contribution of funds during 2002 to the DeLay’s PAC was among the allegations of wrongdoing that led to DeLay’s indictment in Travis County last year.

Continue reading →

DeLay is done

Posted on by
Reply

DeLay10.jpgThis NY Times article and this WaPo article are reporting that Houston Congressman and former House Majority Leader Tom DeLay will announce today that he is leaving Congress and pulling out of his ongoing re-election bid. Earlier posts on DeLay’s mounting troubles over the past couple of years are here. Although DeLay won the Republican primary last month in his re-election bid, he still faced a tough re-election race against former Rep. Nick Lampson in November.
Once one of the most powerful politicians in Washington, DeLay was indicted in Travis County (Austin) last year for his role in allegedly routing illegal campaign contributions into Texas during the 2002 elections that followed a controversial redistricting effort in Texas that cemented Republican dominance of the Texas Congressional delegation. DeLay is also at the center of an increasingly broad Justice Department corruption probe of former Republican lobbyist and top DeLay fundraiser Jack Abramoff and former DeLay aides. Two of DeLay’s former aides have pleaded guilty in the investigation and Abramoff was sentenced last week to over five years in prison after copping a plea deal earlier. DeLay has not yet been accused of a crime in the probe, but he appears to be a target of the ongoing investigation.
However, even if DeLay is not charged, he clearly displayed poor judgment in his personnel decisions. As this Wall Street Journal ($) editorial observed today:

What caused this outbreak of greed is impossible to know for sure. Clearly a sense of entitlement set in among some Republicans, who forgot why they were elected and began to believe that power was its own reward. We can recall when Republicans, back in the early 1990s, proposed to reduce the size of their Capitol Hill staffs in order to reduce the scope of Congressional mischief. That idea went away pretty fast once they became a majority.

Could this be the reason?