Enron Chairman Kenneth Lay quit yesterday, saying investigations of the beleaguered company take so much of his time, the firm is better off with someone else in charge.
“I want to see Enron survive, and for that to happen, we need someone at the helm who can focus 100 percent of his efforts on reorganizing the company,” Lay said in a statement.
Lay will remain on the company’s board.
The fallen energy giant says that in conjunction with creditors, it’s seeking a replacement who will aid efforts to emerge from bankruptcy.
Lay left as angry former employees slapped him, other Enron execs and auditor Arthur Andersen with a federal racketeering suit.
The suit – one of dozens against the company – charges that Lay and Enron honchos illegally forced employees to buy Enron stock through the company’s 401(k) plan and to take bonuses in stock.
“We intend to prove that Enron knew it was matching employees’ [401K] contributions with the modern-day equivalent of plug nickels,” said lawyer Steve Berman.
The federal Racketeer Influenced and Corrupt Organization statute – often used to nail mob wiseguys – is well-suited to helping workers caught in the Enron mess, Berman said.
“The RICO act is a powerful tool to punish those who conspire to defraud, and one we think fits Andersen and Enron like a glove,” Berman said.
Outside Enron’s Houston headquarters yesterday, the Rev. Al Sharpton demanded aid for victims of the firm’s collapse.
“Everyone is focusing on who to prosecute, rather on providing relief for those who have lost their life savings and are now out of work,” he said.
If the government can bail out airlines and other struggling companies, he said, “It can certainly find money for victims who would not have been victimized if the government had protected them.”
Congress plans its first hearing into the Enron mess today. The star witness is David Duncan, an auditor axed by Andersen for his role in shredding documents. But Duncan says he’ll take the Fifth unless he gets immunity.