Digital Deception

Scandal that destroyed faith in the market

The word Enron has become synonymous with deception ever since the news
story about the scandal broke.  The chief executive Kenneth Lay insisted
everything was fine when the media started inquiring about his companies’
financial problems, but in actuality he was deceiving the nation, just as
he had been deceiving his stock holders for the last twenty years. The
scandal started with the company trading natural gas futures and in effect
it became an energy "bank", providing guaranteed quantities at set prices.
In the early years, when prices were favorable, it raked in the profits.
Executives soon realized that if it worked for gas, than it could also
work for water, steel, and basically anything else.  By inventing new
markets and dominating them before regulators knew what was going on, the
money continued to flood in. The company even earned the title of
"America's most innovative company" from Forbes for six consecutive years.
Kenneth Lay and Jeffrey Skilling deceived their employees, stock holders,
and everyone else involved in the business world.  Their deception caused
thousands of people to lose their jobs, their savings, and their
retirement plans.  People deceive each other for various reasons.
Sometimes deception is used to benefit the other party, for example
telling a harmless lie to someone in order to protect their feelings.  In
Enron’s case, deception was not used to benefit the other party, but
instead it was used to benefit Ken Lay and Jeff Skilling. The deception
did not stop at Lay and Skilling, Enron executives and their families also
benefited to the tune of millions of dollars at the same time as they were
making even more by selling Enron's inflated shares.   A person usually
has a motivation for lying; most people do not just lie for the fun of it.
The Enron executives deceived their company out of pure greed.  All of
the company scandals that have arisen over the past few years deal with
greed.  The desire to make more and more money caused the executives of
large corporations to deceive their employees and their country.  Overall
deception can take many different forms, some good, and some bad.  In
Enron’s case, the deception that was used caused thousands of people to
lose their jobs and left many families penniless.

posted by Nicole @ 2:32 PM