Enron Corp. - University of California | Office of The President

disclosures were crafted and approved by Enron's outside auditors and its outside counsel in
meetings between Enron's top insiders and Enron's counsel at Vinson & Elkins and Enron's
auditors at Andersen. Enron's manipulative devices, contrivances and related-party transactions
were extraordinarily lucrative for Fastow and others. In exchange for their passive and largely risk-
free roles in these transactions, the LJM partnerships and their investors were richly rewarded.
Fastow and other Enron employees received tens of millions of dollars at Enron's expense. Enron
employees involved in the partnerships were enriched, in the aggregate, by tens of millions of
dollars they should never have received – Fastow by at least $30 million, Kopper by at least $10
million, two other Enron employees by $1 million each and still two more by hundreds of
thousands of dollars.
68. As outrage over what is likely the worst financial scandal involving a public company
in the history of the United States erupted, Congress launched the most massive investigation it has
ever undertaken of a public company's financial fraud, summoning before it some of the Enron
executives and Andersen partners who were intimately involved in these matters. Nancy Temple,
a senior Andersen lawyer who directed the destruction of documents and defendants Lay, Fastow,
Buy and Causey of Enron and David Duncan, the Andersen partner in charge of the Enron account,
have all refused to testify, asserting that their testimony would incriminate them.
69. As Newsweek has written:
In the late 1990s, by my count, Enron lost about $2 billion on telecom capacity, $2
billion in water investments, $2 billion in a Brazilian utility and $1 billion on a
controversial electricity plant in India. Enron's debt was soaring. If these harsh
truths became obvious to outsiders, Enron's stock price would get clobbered – and
a rising stock price was the company's be-all and end-all. Worse, what few people
knew was that Enron had engaged in billions of dollars of off-balance-sheet deals that
would come back to haunt the company if its stock price fell.
Newsweek, 1/21/02.
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