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'Don't buy it,' Enron prosecutor tells jurors

In closing arguments, the prosecution says two former Enron executives want to deceive jurors like they deceived their company.

By ASSOCIATED PRESS
Published May 16, 2006

HOUSTON - The message from a prosecutor to jurors in the Enron trial Monday was clear: Don't let Kenneth Lay and Jeffrey Skilling turn you into the latest 12 victims of their criminal conspiracy.

In a closing argument stretched over nearly four hours, prosecutor Kathryn Ruemmler implored the eight-woman, four-man jury to reject the "cover stories" the former chief executives were trying to sell in their federal fraud trial.

"They're trying to deceive you in this courtroom in the exact same way they deceived their investors," Ruemmler said. "It's insulting to your intelligence. Don't buy it. It's not going to work."

Then, in a theme she sounded several times during her message to the jury, she added: "Do not let them get away with it."

Ruemmler, pacing in front of the jury box and once even banging her palm on a lectern, said Lay and Skilling used "accounting tricks, fiction, hocus-pocus, trickery, misleading statements, half-truths and outright lies."

To drive home her point that the two executives behaved as if they were above the law, Ruemmler gestured repeatedly to a poster set up next to the jurors that carried a snippet of Lay's testimony.

"Rules are important, but they should not - you should not be a slave to the rules either," it said.

For their part, Lay and Skilling sat calmly for most of the argument, each making notes on a legal pad. At times they exchanged slight smiles and shook their heads in what appeared to be disbelief.

Ruemmler walked jurors through a meticulous recap of the testimony in the case, describing each crime charged against Lay and Skilling and linking it to documents in evidence and particular witnesses' testimony.

Anticipating another attack by the defense on the credibility of Andrew Fastow, Enron's former chief financial officer and an important prosecution witness, Ruemmler portrayed him as someone who could not have been lying to the jury.

For example, she said, Fastow claimed Skilling made pledges to him only twice that Fastow's investment partnerships would not lose money on a deal with Enron. The partnerships made six deals with Enron in one eight-day span in 1999 alone.

Ruemmler reminded jurors often of the thousands of Enron employees who lost their jobs, not to mention millions in retirement savings, because they were kept in the dark about the true - that is, failing - condition of the company in 2001.

She hammered Lay for selling $70-million in Enron stock back to the company in 2001 without publicly disclosing the sales. Lay is not charged with improper stock sales, but was telling employees that summer only that he was buying shares.

On Aug. 20, 2001, just days after Skilling had resigned as CEO and Lay had returned to the post, Lay told BusinessWeek Online in a bid to soothe nervous investors that "there is no other shoe to fall."

"Those were flat lies," Ruemmler said, pounding her hand on the lectern. "He had no right to do that. No right to do that."

That summer, Lay and Skilling could have told investors and employees about a host of problems at Enron: Its broadband unit had failed, asset values were overblown and financial vehicles designed to lock in gains from assets and investments were crumbling.

Lay and Skilling are accused of fraud, conspiracy and other charges in the downfall of Enron, which entered bankruptcy protection in early December 2001.

The men countered that there was no overarching fraud at Enron, and that it was brought down by Fastow's skimming cash from the company, negative media attention, rumor-spreading short-sellers and the broader U.S. bear market.

Today, lawyers for Lay and Skilling will share six hours to make their case to the jury. Federal prosecutors get one last shot Wednesday morning before the case goes to the jury.

In his jury instruction, U.S. District Judge Sim Lake told jurors to consider the case "without prejudice or sympathy" when they start deliberations on Wednesday.

"You as jurors are the judges of the facts," Lake said.

[Last modified May 16, 2006, 06:42:20]