Kenneth Lay indicted in $67bn Enron scandal

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The Independent Online

Kenneth lay, the former chairman of Enron, has been formally indicted for his role in the accounting scandal which led to the $67bn (£36bn) bankruptcy of the energy trading group in December 2001 - at the time the largest business failure in US history.

Kenneth lay, the former chairman of Enron, has been formally indicted for his role in the accounting scandal which led to the $67bn (£36bn) bankruptcy of the energy trading group in December 2001 - at the time the largest business failure in US history.

Because the indictment by a Houston grand jury was sealed, no details were immediately available of the charges being brought against the 62-year-old Mr Lay. But it follows that of the former Enron chief executive Jeffrey Skilling in February, and the guilty plea by Andrew Fastow, Enron's then chief financial officer, who devised the intricate fraud which led to the disaster.

Mr Lay last night said he would surrender to the federal authorities today, adding: "I have done nothing wrong, and the indictment is not justified." The charges are likely to involve fraud and insider trading. They will probably be announced by the Justice Department, which for the past two and a half years has been conducting the Enron investigation.

Mr Lay has all along denied any wrongdoing, saying that he knew nothing of the off-balance-sheet shell companies used to hide massive quantities of Enron debt. Through his lawyers, he has blamed the collapse on Mr Skilling and Mr Fastow, who is co-operating with prosecutors. Mr Lay, however, did take direct charge of Enron after Mr Skilling unexpectedly resigned in August 2001.

More than 20 former senior executives have been charged in connection with the bankruptcy, which also destroyed Enron's auditor Arthur Andersen.

The indictment of Mr Lay in a sense completes the Enron circle. It may also embarrass President Bush, to whose campaigns the former Enron chairman was a major contributor.

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