Skilling Paints Picture of Innocence at Enron

Former Enron CEO Jeffrey Skilling says that he and most of his Enron colleagues are innocent of fraud as he testifies in his own defense in Houston. Skilling will be cross-examined later in the week by prosecutors. Former Enron Chairman Kenneth Lay is expected to testify later in the month.

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MICHELE NORRIS, host:

From NPR News, this is ALL THINGS CONSIDERED. I'm Michele Norris.

ROBERT SIEGEL, host:

And I'm Robert Siegel. In Houston, former Enron CEO Jeffrey Skilling took the stand today. Skilling said he is absolutely innocent of federal charges of fraud and conspiracy to deceive investors. His testimony over the next week will be the lynchpin of his defense. If he fails to convince the jury, Skilling could face decades in prison. NPR's Wade Goodwyn is at the federal courthouse in Houston. Wade how did Jeffrey Skilling do?

WADE GOODWYN reporting:

Well, you know, he's doing okay. He looked frightened in the beginning. And the first thing he said, in fact, was I guess in some respects, my life's on the line. So I'm a little nervous. It's becoming clear as we watch that the defense is trying to project the image of just Skilling as a reasonable guy. At Enron, he had a reputation for being kind of scary with a bad temper, and sometimes he acted out in public too.

In one conference call with Wall Street analysts, Skilling called one analyst an obscenity after that guy began questioning him closely about Enron's finances. You know, that's on a conference call with dozens of people listening. And you can bet the jury heard all about this when the prosecution was presenting its case. So in addition to the content of his testimony, defense lawyers want to try to counteract this image of Skilling as a bully. And Petrocelli, Daniel Petrocelli, Skilling's lawyer, he decided that his first order of business was going to introduce the jury to this different version of Jeff Skilling. The reasonable and likeable Jeff Skilling

SIEGEL: Well that's the, that's the image or the character of Skilling they're trying to present. What about the substance of his testimony about the charges?

GOODWYN: Well, you know, it's interesting because Petrocelli chose to start by focusing on the last four months of Enron's life, specifically about why Skilling left the company four months before it collapsed. I didn't understand that at first, but I think it's because with Skilling's resignation, just before Enron goes bankrupt, it kind of appears like Skilling's leaving the scene of a crime. Only the crime hasn't happened yet, but Skilling knows it's going to. At least that's what the government would assert. So Petrocelli is having Skilling explain that he left Enron not because he saw a bad moon rising, but because he was burned out and had neglected his family.

Skilling described step-by-step on the stand his horror at watching his company slowly slide into oblivion. He said he tried to come back to Enron to help them, but he was turned down by the Board of Directors who told him that, you know, any return by him would just look like one more weird thing going on at Enron. And then Skilling said he started drinking heavily. He fell into depression, and he said that ultimately he felt like he just wanted to die.

What the jury is seeing today is the picture of a very sad man. And I don't think Jeff Skilling has to do any acting in that regard.

SIEGEL: Well Skilling and the founder of Enron, Ken Lay, are both on trial here. Have we heard from Skilling at all about, about his fellow defendant?

GOODWYN: No. There's not been much substance of testimony about Lay. I mean his turn's going to come in about two weeks. There has been talk about two of the government's witnesses, Mark Koenig who was head of investor relations, and Ken Rice who was running the broadband division.

Skilling said Mark Koenig was one of the most honest people he's ever known. I'm not sure why he testified this way.

SIEGEL: He's a prosecution witness against Skilling?

GOODWYN: Yeah. They did briefly attack Andrew Fastow then, the former CFO. But the defense is going to have to come back to this because it's imperative that Skilling have a powerful response to the testimony from these top Enron executives who are the government's best witnesses, after all.

SIEGEL: Now apart from all of that self-description of what he's like and what a likable person he is, did he convey a rather amiable and gentle demeanor as he testified in court?

GOODWYN: He did. You know, all this goes to the issue of believability. And, you know, at one point Skilling asked if, Petrocelli asked Skilling if he thought all those Enron executives were truly guilty of the crimes they'd admitted to. And without naming any names, Skilling said he didn't think most of them were guilty of anything. So then Petrocelli said to Skilling, so you think you're better than all these people? And that allowed Skilling to say no, he didn't think he was better than them. He just thought the government had pressured them into pleading guilty. And that was a subtle way to allow Skilling to kind of push back on that testimony without having to call anyone a liar. That's Petrocelli's style. He's not going to hide from the problems his client had. I think it's a good strategy, because given how Enron blew up, and the case the government's presenting, I mean, there's going to be no hiding. So why waste time dissembling.

SIEGEL: Thank you Wade.

GOODWYN: You're welcome.

SIEGEL: That's NPR's Wade Goodwyn at the Enron Trial in Houston.

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