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Lay and Skilling guilty

Ex-CEO and founder convicted on fraud and conspiracy charges in Enron case.

By Shaheen Pasha and Jessica Seid, CNNMoney.com staff writers

May 25, 2006: 1:00 PM EDT

 

HOUSTON (CNNMoney.com) - Enron former chief executive Jeffrey Skilling and founder Kenneth Lay were found guilty Thursday of conspiracy and fraud in the granddaddy of all corporate fraud cases.

 

On the sixth day of deliberations, a jury of eight women and four men convicted the former executives of misleading the public about the true financial health of Enron, whose collapse in late 2001 symbolized the wave of corporate fraud that swept the United States early this decade.

 

Skilling was found guilty on 19 counts of conspiracy, fraud, false statements and insider trading. He was found not guilty on eight counts of insider trading.

 

Lay was found guilty on all six counts of conspiracy and fraud. In a separate bench trial, Judge Sim Lake ruled Lay was guilty of four counts of fraud and false statements.

 

Both Lay and Skilling could face 20 to 30 years in prison, legal experts say.

 

Judge Lake set sentencing for the week of Sept. 11 and ordered Lay to surrender his passport and post a cash bond. No home confinement was ordered.

 

Skilling's attorney, Daniel Petrocelli, told reporters outside the courthouse "We will have a full and vigorous appeal."

 

"The jury saw it differently," Petrocelli said, referring to his client's maintaining his innocence. "We'll take it from here."

Tears in the courthouse

 

Skilling stood stone-faced as he was convicted on most of the counts he faced and Ken Lay's daughter began sobbing in the front row anticipating her father's fate. Skilling's wife and children were notably absent.

 

Petrocelli had his hands on his client's shoulder, bracing him.

 

As Lay's verdict was read, his daughter Elizabeth Vittore, who has been one of his attorneys during the case, began to sob uncontrollably. His wife, Linda, clutching his hand, wiped tears away silently. All of his children sat in the front row with other members of the family. One of his sons put his face in his hands and wept.

 

Lay clutched his wife's hand and looked straight ahead.

 

Outside the courtroom after court was adjourned, Skilling said, "We fought a good fight. Some things work. Some things don't."

 

"Obviously I'm disappointed, but that's the way the system works," he added.

 

The verdict is a major victory for the government, and marks the end of one of the most scandalous chapters in the history of corporate America.

Certainly took long enough.