Jeffrey Skilling - Indictment and Trial

Indictment and Trial

Skilling was indicted on 35 counts of fraud, insider trading, and other crimes related to the Enron scandal. He surrendered to the Federal Bureau of Investigation on February 19, 2004, and pleaded not guilty to all charges. The indictments emphasized his probable knowledge of, and likely direct involvement with, the fraudulent transactions within Enron. About a month after quitting Enron, Skilling sold almost $60 million of his stake in the company (in blocks of 10,000 to 500,000 shares), resulting in the prosecutors' allegation that he sold those shares with inside information of Enron's impending bankruptcy. Skilling's main attorney was Daniel Petrocelli, the 52-year-old civil litigator who represented Ron Goldman's father in his successful civil suit against O.J. Simpson for negligent death. Skilling spent $40 million in preparation for the trial, of which at least $23 million went to his defense lawyers' retainer. Skilling's younger brother Mark is an attorney and assisted his legal team during the criminal trial.

The trial began on January 30, 2006, in Houston, despite repeated protests from defense attorneys calling for a change in venue on the grounds that "it was impossible to get a fair trial in Houston," the base of the Enron catastrophe. Skilling, known for his harsh attitude and arrogance, lost his temper on the witness stand during the trial. Enron's bankruptcy, the largest in U.S. history when it was filed during December 2001, cost 20,000 employees their jobs. In addition, many of them lost their life savings. Investors also lost billions. However, Skilling and many of the company's executives had sold huge portions of their Enron stock before the bankruptcy filing, making a substantial profit. When interviewed outside court during the trial by dutch journalist Stephan Tychon of pollutico.com about industrial dominance, Skilling admitted that industrial dominance and abuse constitutes a global problem by saying: "Oh yes, yes sure, it does." On May 25, 2006, the jury returned with the following findings regarding Skilling:

• guilty on one count of conspiracy
• guilty on one count of insider trading
• guilty on five counts of making false statements to auditors
• guilty on twelve counts of securities fraud
• not guilty on nine counts of insider trading

In a front page interview with The Wall Street Journal on June 17, 2006, Skilling claimed, among other things, that he had been melancholic after the Enron bankruptcy and considered committing suicide, but that his indictment actually ended his depression; that the worst witness against him was himself; and that he will be able to survive a long prison term as long as he is given "something to do, something to accomplish" while in prison.

On October 23, 2006, Skilling was sentenced to 24 years and four months in prison, and fined $45 million. The case was appealed but all of his convictions save one were ultimately upheld, as was his sentence. Skilling's request to remain free during the appeal was denied by Judge Patrick Higginbotham of the 5th U.S. Circuit Court of Appeals on December 12, 2006. In ordering Skilling's immediate imprisonment, the judge wrote, "Skilling raises no substantial question that is likely to result in the reversal of his convictions on all of the charged counts," although the order also noted "serious frailties" were possible in some (but not all) of the convictions.

Skilling began his sentence on December 13, 2006, and is currently housed at low security federal prison in Littleton, Colorado. According to the Federal Bureau of Prisons, he is scheduled for release on February 21, 2028, when he will be 74 years old.