- The Washington Times - Wednesday, July 5, 2006

HOUSTON — Enron Corp. founder Kenneth L. Lay, who faced decades in prison for one of the most sprawling business frauds in U.S. history, died yesterday while vacationing in Aspen, Colo. He was 64.

Mesa County Coroner Robert Kurtzman said Lay died of coronary-artery disease. He said his preliminary examination showed clogged coronary arteries to be the cause of death. He said there was evidence Lay had a previous heart attack.

Lay rose from near-poverty as a minister’s son in Missouri to the pinnacle of corporate America. He was considered a visionary who had President Bush’s ear during Enron’s halcyon days, but his reputation and monumental wealth shattered with that of his company. He spent his last years insisting that he was no criminal, even after he became a felon.

“I guess when you’re facing the rest of your life in jail, and in your heart you know you’re an innocent man, I guess it’s too much to bear,” said close friend Willie Alexander.

Lay had stayed out of the public eye since a federal jury on May 25 convicted him and former Enron Chief Executive Officer Jeffrey Skilling of fraud and conspiracy for lying to employees and investors about Enron’s financial health.

Lay, who described himself as naturally optimistic, displayed no signs of ill health throughout the grueling four-month trial that started Jan. 30. His lead attorney, Michael Ramsey, was sidelined for several weeks during the trial because of heart problems.

Along with fraud and conspiracy charges, Lay also was convicted in a separate federal trial of bank fraud and making false statements to banks. Those charges were related to his personal finances.

Lay was scheduled to be sentenced Oct. 23, along with Skilling, who also faces a long prison term.

Lay led Enron’s meteoric rise from a staid natural-gas pipeline company formed by a 1985 merger to an energy and trading conglomerate that reached No. 7 on the Fortune 500 in 2000 and claimed $101 billion in annual revenues.

Lay’s clout evaporated when Enron spiraled into bankruptcy protection in December 2001. The crash obliterated Enron’s more than $60 billion in market value and thousands of jobs, and Lay was pushed out as chairman and CEO in January 2002.

The government launched a widespread fraud investigation that enveloped Enron’s finance, trading, broadband and retail energy units. The probe amassed 16 guilty pleas from former executives, eight of whom testified against Skilling and Lay. Lay and Skilling insisted that no fraud occurred at Enron except from a few employees who skimmed money behind their backs. Jurors were unconvinced.

Prosecutors in Lay’s trial declined comment yesterday, both on his death and what may become of their effort to seek $43.5 million from Lay that they say he pocketed as part of the conspiracy. The government is seeking $139.3 million from Skilling.

The Pitkin County, Colo., Sheriff’s Department said officers were called to Lay’s house in Old Snowmass, Colo., shortly after 3 a.m. Eastern time. He was taken to Aspen Valley Hospital, where he died, said Pat Worcester, executive assistant to the Aspen hospital’s chief executive.

Before Enron became a scandal-tainted punch line, the company was the single largest contributor to Mr. Bush, who nicknamed Lay “Kenny Boy.”

Lay was born in Tyrone, Mo., and spent his childhood helping his family make ends meet. His father ran a general store and sold stoves until he became a minister, and Lay delivered newspapers and mowed lawns. He attended the University of Missouri, found his calling in economics, and went to work at Exxon Mobil Corp.’s predecessor, Humble Oil & Refining.

He joined the Navy, served his time at the Pentagon and then served as undersecretary for the Department of the Interior before he returned to business. He became an executive at Florida Gas, then Transco Energy in Houston and later became CEO of Houston Natural Gas. In 1985, HNG merged with InterNorth in Omaha, Neb., to form Enron, and Lay became chairman and CEO of the combined company the next year.

Lay is survived by his wife, five children and stepchildren and 12 grandchildren.

Copyright © 2018 The Washington Times, LLC. Click here for reprint permission.

The Washington Times Comment Policy

The Washington Times welcomes your comments on Spot.im, our third-party provider. Please read our Comment Policy before commenting.


Click to Read More and View Comments

Click to Hide