Skilling tells his Enron story

One of the most enduring images of the Enron collapse is of a defiant Jeffrey Skilling testifying before Congress in February 2002, raising his right hand and defending the reputation of the Texas energy company he'd help build.

He did so, he told a jury in a Houston courtroom this week, against the advice of his lawyers, who urged him to exercise his constitutional right not to incriminate himself and to remain silent in front of Congress, the Securities and Exchange Commission, even "Larry King Live."

"Someone had to get out and start explaining what had happened before someone else explained it incorrectly," said Mr. Skilling in his first days on the stand in his criminal trial.

He still stands behind what he did and said, he testified. But now that he is in the witness box in his own defense, those prior statements make his path much harder.

"Skilling made so many public pronouncements at the embryonic stage of the investigations, and all of that can be used against him," says Christopher Bebel, a Houston securities lawyer and former federal prosecutor.

After those early days, the former Enron president and CEO went quiet - and remained so for four years. Now, in his first testimony since Enron's collapse, Skilling is still defiant - this time over the allegations against him.

In his first days of testimony, he has said repeatedly that he is "absolutely innocent," that he never lied about Enron's financial health or told anyone to lie about it. He has detailed certain transactions and talked in general about his feelings about Enron.

"I was proud of the people that joined Enron, proud of walking into the building. When you walked into the lobby, there was excitement," he said. "We were making the world better."

On a personal level, Skilling said, the company meant a lot to him because he had a large part in its transformation from a small pipeline business into one of the world's largest energy companies. In the process, he became rich beyond his wildest dreams, but also suffered from an "obsession" with Enron, he said. When he came to realize that his professional life had overshadowed his personal life, he resigned in August 2001. Enron collapsed in December.

Prosecutors argue that Skilling quit because he was involved in fraud at the company and could see the handwriting on the wall when the firm's stock price began to drop.

Skilling, for his part, said the stock price began to fall because of bad publicity planted by short sellers. He told Congress the same thing when he testified before a House Energy and Commerce subcommittee in February 2002. "Enron's failure was due to a classic run on the bank, a liquidity crisis spurred by a lack of confidence in the company," he said at the time.

Page: 1 | 2