Enron was an energy-trading and utilities company founded in the mid 1980s and fell into bankruptcy in 2001.
Senior executives at Enron engaged in a scheme to defraud in violation of federal securities laws. The
violations involved massive fraudulent accounting where it characterized as prepay forward contracts in order
to disguise borrowings as cash from operations and investors, inflating false profits to about $1 billion. Losses
totaled more than $74 billion. Part of the scheme included senior executives encouraging lower level
employees to invest knowing it was shortly filling for bankruptcy. Many, if not all, lower level employees loss
their retirement savings.
While watching this documentary identify warning signs or red flags. Were there any? Could this have been
prevented?
You can find Enron: The Smartest Guys in the Room documentary through the college library’s Kanopy
account (https://madisoncollege.kanopy.com/video/enron-smartest-guys-room-5).

 

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