Enron Corporation A Foundation Of Fraud, Corruption,...

Enron Scandal December 31, 2001 will forever be etched in history as the day that one of the biggest white collar scandals came to an end. Electric and natural gas giant Enron was found to have been defrauding its investors out of billions of dollars in order to increase its stock prices, and fatten the pockets of high executives particularly Chairman and CEO Kenneth Lay, President and COO Jeffrey Skilling, and CFO Andrew Fastow. Thousands of employees were laid-off and lost their 401(k); those already retired lost funding from their pension.1 In this paper I will demonstrate that the Enron corporation was operating on a foundation of fraud, corruption, greed, and immorality; I will also reflect on the legal and financial consequences surrounding the scandal. The Enron corporation was formed in 1985 by the merging of two natural gas companies, Houston Natural Gas, and InterNorth; In the following year Kenneth Lay was appointed Chairman and CEO.2 Enron began its escapade of fraud and corruption in April of 1987 when it was discovered by Enron executives that Louis Borget and Thomas Mastroeni, traders in their Valhalla, New York office, known as Enron Oil, had been misappropriating funds; traders were â€Å"gambling beyond their limits, destroying trading reports, keeping two sets of books and manipulating accounting† (PBS, 2015) to make it appear as if the company’s profits were legitimate. The shocking yet not surprising response from CEO Kenneth Lay was not to fire the twoShow MoreRelatedCan Profitability and Morality Co-Exist?10045 Words   |  41 Pagessocial responsibility of business and that is to use its resources and engage in activities designed to increase its profits so long as it stays within the rules of the game, which is to say engages in open and free competition without deception or fraud. The question is of whether, in defining the business and understanding it as a moral reality, we should focus primarily on its goal of producing goods and services or of generating profits. A single concept of profit is not by itself sufficient to