HOUSTON — Handing the government its biggest victory in its war on corporate corruption, a federal jury Thursday found former Enron Corp. executives Kenneth L. Lay and Jeffrey K. Skilling guilty of conspiracy and fraud in connection with the 2001 collapse of the onetime energy trading giant.
Jurors said they rejected the defense that there was no crime at Enron -- that Lay and Skilling were unfairly targeted by a government bent on making them the scapegoats for their company's failure. They said the defendants' own testimony helped to make up their minds.
"I wanted very, very badly to believe what they were saying," juror Wendy Vaughan, owner of a roofing business and a fitness company, said at a news conference after the verdict. But "there were places in the testimony where I felt their character was in question," she added.
In the end, the jury embraced the testimony of a parade of former Enron executives who said that Lay and Skilling had lied publicly about the energy company's financial health and condoned, if not actively encouraged, the use of accounting tricks to boost reported earnings and to hide debt.
The verdicts came at the end of a four-month trial, on the morning of the sixth day of deliberations by the panel of eight women and four men. The jurors found Lay guilty of conspiracy and five counts of fraud -- all the charges he faced. They convicted Skilling of one count of conspiracy, 12 counts of fraud, five counts of making false statements and one count of insider trading. He was acquitted of nine other insider-trading counts.
In addition, after a separate three-day nonjury trial, U.S. District Judge Sim Lake found Lay guilty of one count of bank fraud and three counts of making false statements to banks while arranging bank lines of credit.
Enron's implosion was one of the most infamous corporate scandals in U.S. history. The energy company's failure wiped out more than 4,000 jobs and billions of dollars of stock market value. It also led to sweeping regulations and legislation -- particularly the 2002 Sarbanes-Oxley law -- meant to curb corporate wrongdoing and restore confidence in companies' financial statements.
Lay and Skilling, Enron's former chairman and chief executive, respectively, became the headline targets of a massive crackdown on corporate wrongdoing that also resulted in charges against executives of such companies as WorldCom Inc., Adelphia Communications Corp., HealthSouth Corp. and Tyco International Ltd.
