Ex-Enron Corp. CEO Jeffrey Skilling — viewed by many as exemplifying the worst in corporate fraud and greed in America — could be released from prison in about four years, after a federal judge on Friday shaved off a decade from his original sentence of more than 24 years.
Skilling’s resentencing during a packed courtroom hearing brought one of the country’s most notorious financial scandals — the collapse of the once-mighty energy giant — to a conclusion that upset some former Enron workers.
Ex-Enron worker Diana Peters, the only victim who spoke at the resentencing hearing, said afterward in a phone interview that Skilling should have to serve his entire original sentence.
“Jeffrey Skilling has never taken any responsibility for his actions,” said the 63-year-old Peters, who lives in Huntsville, north of Houston. “He has no remorse for the end result of what happened.”
Even before Friday’s resentencing, which was part of a court-ordered reduction and a separate agreement with prosecutors, Skilling had already been set to have his sentence of about 8½ years shortened after an appeals court vacated his original sentence by U.S. District Judge Sim Lake.
The appeals court ruled that a sentencing guideline was improperly applied. However, Skilling’s resentencing was delayed for years as he unsuccessfully sought to overturn his convictions, including appealing to the U.S. Supreme Court.
The Justice Department said that in order to resolve a case that’s gone on for more than 10 years, it agreed to an additional reduction of about 20 months as part of a deal to stop Skilling from filing any more appeals. Federal prosecutors say it will allow for $41.8 million of Skilling’s assets to be distributed as restitution to victims of Enron’s 2001 collapse.
Skilling, 59, who has been in prison since 2006, declined to make a statement during Friday’s hearing.
His attorney, Daniel Petrocelli, said he disagrees with claims that his client, who “still maintains his innocence,” never expressed remorse for what happened at Enron. He said Skilling wasn’t aware of the illegal activities of others but “took complete responsibility for all the actions” at the company.
Petrocelli said the reduction, combined with time off for good behavior and other factors, means Skilling is likely to be released by 2017.
During the hearing, prosecutor Patrick Stokes criticized Skilling for continuing “to cast himself as a victim,” and said Skilling “is anything but a victim.”
“Mr. Skilling was not only at the pinnacle of Enron, he was at the pinnacle of the fraud schemes,” Stokes said.
Once the money from Skilling’s assets is added, about $560 million in restitution will have been collected for victims of the Enron scandal, Stokes said.
Former Enron employee George Maddox said he still blames Skilling for his losing $1.3 million in retirement savings when Enron collapsed. Maddox worked for 30 years as a plant manager with the company.
“Long sentences are for no one but poor people,” said Maddox, 79, who lives in the East Texas town of Van, where he supports himself and his 16-year-old grandson mainly on Social Security income.
Even with the reduced sentence, Skilling’s prison term is still the longest of those involved in the Enron scandal. He was the highest-ranking executive to be punished. Enron founder Kenneth Lay’s similar convictions were vacated after he died of heart disease less than two months after his trial.
Philip Hilder, a Houston attorney who represented several ex-Enron executives who cooperated with prosecutors, called Skilling’s new sentence “a fair resolution” to his case.
But Andrew Stoltmann, a Chicago-based attorney who represented 10 people who lost money in Enron’s collapse, called the new sentence “a slap in the face” to ex-Enron workers and investors.
Skilling was convicted in 2006 on 19 counts of conspiracy, securities fraud, insider trading and lying to auditors, for his role in the downfall of Houston-based Enron. The company, once the seventh-largest in the U.S., went bankrupt under the weight of years of illicit business deals and accounting tricks.
The U.S. Supreme Court said in 2010 that one of Skilling’s convictions was flawed, in a ruling in which it sharply curtailed the use of the “honest services” fraud law — a short addendum to the federal mail and wire fraud statute that makes it illegal to scheme to deprive investors of “the intangible right to honest services.”
The high court ruled prosecutors can use the law only in cases where evidence shows the defendant accepted bribes or kickbacks, and because Skilling’s misconduct entailed no such things, he did not conspire to commit honest services fraud.
The Supreme Court told a lower court to decide whether he deserved a new trial; the lower court said no.
Enron’s collapse put more than 5,000 people out of work, wiped out more than $2 billion in employee pensions and rendered worthless $60 billion in Enron stock. Its aftershocks were felt across Houston and the U.S. energy industry.