Oh, Enron, I thought – hoped and dreamed? – that you were long gone, locked in the dustbin of history, reserved for seriously fraudulent companies.
But apparently not.
More than twenty years after Enron's bankruptcy in December 2001, the company is back. Well, at least one entity using the website Enron.com went public on Monday, announcing the relaunch of Enron as “a company dedicated to solving the global energy crisis.”
On social media, the company posted a simple message: “We're back. Can we talk?”
I mean, I'd rather not. But you might be wondering, especially if you're under 40, why this is news. Moreover, why is Ars Technica's space editor writing about it? Well, gather around the campfire for a little bit of history, my friends.
What Enron was
A quarter century ago, Enron was a titan of American industry. It was this amazing success story from Houston that revolutionized energy trading as a commodity and did a lot of other groundbreaking things like trading bandwidth, delivering home video, and essentially trying to own the Internet. It started reporting incredible revenues of more than $100 billion a year, and the company's CEO, Ken Lay, was among the most prominent people in Houston, where I live.
Only it all turned out to be a huge fraud. It was bigger than the Theranos scandal, before Theranos existed. Wikipedia summarizes what happened well: “Enron's reported financial condition was maintained by an institutionalized, systematic, and creatively planned accounting fraud.”
Yes, pretty much. It all quickly unraveled in late 2001.
Lay died of a heart attack while awaiting sentencing after being found guilty of multiple charges of conspiracy and fraud. The company's president, Jeffrey Skilling, was convicted of conspiracy, insider trading and securities fraud. He served 12 years of a 24-year sentence before being released from prison in 2019. Chief Financial Officer Andrew Fastow received a six-year prison sentence after cooperating with federal authorities. One of the 'big five' accounting firms, Arthur Andersen, was in turn completely dissolved. It was all a big fuss and the Enron scandal became a cautionary tale.
