In this article, you’ll learn about the people involved in the Enron scandal and how they were connected to it. How did a respected company make it to the top of its industry only to crumble into economic tragedy? Its skyrocketing profits were followed by the largest bankruptcy case in US history. It is probably the most scandalous business story of our times. Working with the best-selling book, filmmaker Alex Gibney saw the Enron story as more than a corporate scandal: "I felt that the film would give me an opportunity to explore some larger themes about American culture, the cruelty of our economic system, and the way it can be too easily rigged for the benefit of the high and mighty.1-Page Summary of The Smartest Guys in the Room OverviewĮnron Corporation, once the world’s largest energy company, has become synonymous with fraud and corruption. The torpedo had hit with 20 minutes to get out."Ī fascinating exploration of corporate culture and epic misdeeds, ENRON: The Smartest Guys in the Room takes viewers from the heyday of soaring profits through the prolonged fallout, including the collapse of Arthur Andersen, the 2006 convictions of Lay, Skilling and Fastow, followed by Lay's death two months later, which vacated his conviction. With lifeboats gone, stocks and retirement accounts worth nothing, Enron employee Max Eberts recalls, "It was kind of like being on the Lusitania. When Enron's sleight of hand accounting and unethical trading eventually meet the realities of balance sheets that don't balance and products that don't exist, unwitting employees who have anchored their financial futures to the Enron ship watch in horror as water rushes in overhead. And Enron's West Coast power desk has its most profitable month ever, as California citizens become casualties of Enron's scheme to artificially increase demand for electricity, resulting in rolling blackouts and two deaths. Meanwhile, Skilling's "black box" accounting results in declared earnings of 53 million dollars for a collapsing deal that doesn't profit a cent. As the pioneer behind this strategy to switch from a pipeline company to trading, Jeff Skilling is named CEO, and the company stock skyrockets. The story begins in 1985, with the merger of Houston Natural Gas and Omaha, Nebraska's natural gas company, InterNorth, to form the natural gas pipeline company called Enron.īy 2000, the company has grown into the largest natural gas merchant in North America, eventually branching out into trading other commodities, such as water, coal and steel. As a result, we come to understand how the avarice of Enron's traders and their bosses had a shocking and profound domino effect that may shape the face of our economy for years to come. The film comes to a harrowing climax as audiences hear Enron traders' own voices as they wring hundreds of millions of dollars in profits out of the California energy crisis. Who would think a documentary about the collapse of a mammoth corporation could play out like a drama with the emotional power of Greek tragedy? But that is the impact of ENRON: The Smartest Guys in the Room, the inside story of one of history's greatest business scandals, in which top executives of America's seventh largest company walked away with over one billion dollars while investors and employees lost everything.īased on the best-selling book The Smartest Guys in the Room by Fortune reporters Bethany McLean and Peter Elkind, and featuring insider accounts and incendiary corporate audio and videotapes, this tale of greed, hubris and betrayal reveals the outrageous personal excesses of the Enron hierarchy and the moral vacuum that led CEO Ken Lay-along with other players including accounting firm Arthur Andersen, Chief Operating Officer Jeffrey Skilling and Chief Financial Officer Andy Fastow-to manipulate securities trading, bluff the balance sheets and deceive investors.
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