Table of Contents
Introduction...........................................................................................2
History..................................................................................................2
Influential Individuals................................................................................3
The Decline............................................................................................3
Losses and the SEC...................................................................................4
The Scandal............................................................................................6
The Legendary Letter.................................................................................7
Other Primary Factors................................................................................8
The Fallout..............................................................................................9
New Legislation....................................................................................10
Conclusion...........................................................................................11
Illustrations..........................................................................................13
Works Cited..........................................................................................14
Introduction
Webster's dictionary defines fraud as: deceit, trickery, perpetuated for profit or to gain some unfair or dishonest advantage. Enron's business practices were in every way, the definition of fraud. Despite Enron's family business practices, they were the world's primary producer of electricity, natural gas, and communications companies. Prompted by the dealings of Enron, many changes in business practices such as laws and legislation have occurred. Naturally, the entire world of business has experienced a great deal of change since the surfacing of the Enron scandals. People involved in the business world may never completely understand all the dynamics involved in such a disastrous global company leader meltdown. Basically, Enron has given new meaning to the saying, "What goes up must come down."
Enron Downfall
English: Enron Complex in Houston Texas
English: Mug shot of Kenneth Lay.But, the question is why and how did it come down the way it did? Thus, it is time to consider and reflect the history, decline, and fallout of this financial market giant.
History
As an American energy company based in Houston, Texas, Enron employed 21,000 people. Enron produced materials such as plastics, steel, Petrochemicals, streaming media and Broadband products. The Enron Corporation developed from a natural gas pipeline company into a global trading empire. First, Enron competed in the business of acting as a broker between energy suppliers and buyers. Then, Enron expanded its position as a broker of non-energy transactions. In essence, Enron became the seventh largest corporation in the United States until 2001. Fortune Magazine named the Enron Corporation "America's Most Innovative Company." After all these successes, Enron became involved with some risky investments. Accordingly, Enron declared revenues of $111 billion in the year 2000...