Case file #5
ENRON
Filed under financial fraud, 2000s.
- Era
- 2000s (2001)
- Date
- December 2
- Status
- Closed
Spoilers ahead
This page tells the whole case, including how it ended. Play the case first and see how far the six exhibits take you.
Read the case file
Enron's mark-to-market accounting booked projected future profits immediately, while CFO Andrew Fastow's special-purpose entities (Chewco, JEDI, the Raptors) hid mounting losses off the balance sheet. VP Sherron Watkins warned Ken Lay in August 2001; the company filed what was then the largest bankruptcy in U.S. history on December 2, 2001. Auditor Arthur Andersen was convicted of obstruction for shredding (overturned in 2005, too late) and collapsed. Jeffrey Skilling was convicted in 2006 and released in 2019; Lay died before sentencing. The scandal produced the Sarbanes-Oxley Act, the reason public-company audits look the way they do today.