Skilling: The CEO Who Wasn't There

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Former President and CEO of Enron Jeffrey Skilling

Jeff Skilling did show up to testify, and he did indeed have, as he said, "a story to tell." He just wasn't in most of it. The opening statement Thursday of the former CEO (and COO before that) of Enron included all the phrases his congressional inquisitors would be hearing all afternoon: "I was not aware..." "I did not believe..." "I did not have any knowledge..." And of course, a liberal application of the one Ronald Reagan made famous: "I don't recall."

And so in the most anticipated day of the House Committee on Energy and Commerce's Enron hearings since Ken Lay's no-show Monday, lawmakers easily positioned the cloud of blame over Jeff Skilling's relatively full head of executive-style hair. But they couldn't quite make it rain.

The set-up was complete enough. Louisiana Republican Billy Tauzin's committee led off with four people that Skilling, trying to keep the cloud below him on the executive chain, would later have no problem remembering — Andrew Fastow, Michael Kopper, Richard Buy and Richard Causey. The four men, in turn, had no problem taking the Fifth Amendment and quickly departed. Then Tauzin brought out its heroes, former company Treasurer Andrew McMahon and former in-house lawyer Jordan Mintz. Both said they went to Skilling with their concerns about the shady partnerships — and to get his approval on them — and Skilling reportedly gave them the coldest of executive shoulders. Plausible deniability comes in handy when the natural gas hits the fan.

Still, neither McMahon nor Mintz could conclusively make Skilling culpable — or, as McMahon told the committee: "I don't know how well Skilling was informed." Which was pretty much how Skilling summed it up when he took the stand Thursday afternoon. He left Enron Aug. 14 "for personal reasons," he testified, and at the time sincerely believed that Enron was not only in fine shape but that its financial statements "accurately reflected the company's financial condition."

So who was to blame? Everybody else. Mintz and McMahon nudged the cloud upward toward Skilling (and Lay, and Buy and Causey and Kopper and Fastow). Robert Jaedicke and Herbert Winokur, two Enron board members trying to explain why they missed the whole thing, did likewise, throwing in Arthur Andersen and law firm Vinson & Elkins. Said Winokur: "It appears outside experts...failed us." Officials at both Arthur Andersen and Enron, added Jaedicke, "did not fulfill their duty to us."

Skilling showed up in the lion's den because he thought he could run circles of deniability around Tauzin and his gang. He got in some convincingly righteous sparring with hopped-up committee members, and mostly blamed his apparent ignorance of anything rotten in the state of Enron on the difficult, highly delegatory task of running a large and complex international energy corporation. And when that didn't fly with the committee — and it surely didn't — Skilling merely pled more ignorance that Enron's house of cards was ever going to fall.

For a man in the crosshairs, Skilling managed to do pretty well without convincing a soul he was telling the whole story. Toward the end of the hearings, one congressman asked Skilling what he would have done differently to keep Enron's house standing. "I wasn't there," he replied, which was pretty much his defense for everything.