Inside the culture and collapse of Enron

One such instance he described was the Nigerian barge deal, in which Enron sold the barges to Merrill Lynch, then bought them back six months later at a 15 percent profit to Merrill Lynch. The idea, say prosecutors, was to deceive shareholders by making it look as if Enron had made $12 million on the deal.

"This transaction appeared to be blatantly wrong," said Glisan. "It should have been recorded as a loan." But he mentioned his concerns only briefly to a colleague in December 1999 and said his primary concern was to make sure Merrill Lynch was out of the deal by June 2000 - thereby allowing Enron to live up to its word and retain its strong reputation in the banking industry.

When asked if former Chief Financial Officer Andrew Fastow and his protégé Michael Kopper were "the belly of the beast" in the company, Glisan said, "I'm not going to single out Mr. Fastow and Mr. Kopper because that would be deflecting blame from myself."

But earlier in the trial, Kopper himself testified that he and Fastow began devising illegal plans to divert money to themselves and their family and friends in 1997. He pleaded guilty two years ago to two counts of conspiracy, and from the witness stand said he had stolen about $16.5 million from the company since 1997, and helped Fastow - whom he called "brilliant" and "very greedy" - loot $45 million. He now faces 15 years in prison; his sentence will depend on how well he cooperates with government prosecutors.

During the Nigerian barge deal, Kopper said, Fastow "kind of giggled" when he asked his protégé to buy the barges back with an off-balance sheet partnership that Fastow controlled. Kopper said he considered it a risky proposition, but Fastow told him it would help Enron and make him "look like a hero to Jeff Skilling." Fastow, who pleaded guilty and was sentenced last April to 10 years in prison, has also agreed to testify for the government.

"These guys seemed to keep score by how big a deal they could pull off and the massive quantities of money they could amass," says Professor Treece. "They gave no thought to harm to the investors and the people who relied on them. They were motivated purely by greed."

Defense lawyers are expected to argue that it is the government witnesses and the most senior people at Enron - not the former Enron and Merrill Lynch employees currently on trial - who were the criminals. The defendants, they will insist, were innocent victims and believed the barge deal to be real.

But a win for the government in this trial does not necessarily mean a win in the trial against Lay, Skilling, and Causey, says Treece.

"While any Enron-related case is an uphill battle, this type of transaction is relatively easy for jurors to understand: Was it a loan or an illicit transfer of money? Compared to what Skilling and Lay are accused of, this is math. That will be algebra."

• Material from the Associated Press was used in this report.

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