Indictment of Lay not likely, lawyer says

HOUSTON — Enron Corp. founder and former chairman Kenneth Lay will never be indicted on charges stemming from the company’s collapse, despite recent speculation to the contrary, his lawyer said Monday.

“Ken Lay didn’t do a crime,” Michael Ramsey said. “I don’t believe Ken Lay will be indicted at all, ever.”

Still, Ramsey said published reports over the weekend that his client would be indicted within weeks prompted him to request an update from federal prosecutors. He hopes to meet with them this week or next week.

Justice Department spokesman Mark Corallo declined to comment Monday.

Speculation about possible charges against Lay has intensified since former Enron chief financial officer Andrew Fastow pleaded guilty in January to two counts of conspiracy and became the most highly placed former Enron executive to cooperate with the government.

Fastow admitted to scheming to manipulate Enron’s books by hiding debt and inflating profits while enriching himself on the side.

Sources said over the weekend that prosecutors are aggressively pursuing Lay and probably focusing on his actions and statements when he took over as chief executive upon Jeffrey Skilling’s abrupt resignation in August 2001. The Houston Chronicle first reported the possible indictment, expected by month’s end, in Saturday’s editions. The newspaper cited unidentified lawyers close to the case.

Ramsey said Lay didn’t know there was any criminal activity in the company until after its collapse and media accounts began to surface.

“There is no proof that he did anything other than return when Skilling left and do his best to open the company up,” Ramsey said of Lay. He said Lay came close to turning the company back around.

“He looked for problems. He did restatements. He listened to the accountants. He did those things that were necessary in his judgment to fix the company,”

Ramsey has said Lay took over as chief executive officer to cure any problems that existed and build morale at the company, which collapsed into bankruptcy in December 2001 as a result of an accounting scandal.

Skilling and top accountant Richard Causey are awaiting trial on charges of conspiracy, fraud and insider trading.