Enron's Flowing Around Doing Deals

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When skilling gets elevated to number two and fast out to CFO the company, they start articulating as the company strategy that the finance department is going to go from being this shared resource cost center to a profit generating division. And structured finance kind of becomes its own division. The fact that this didn't raise massive alarm bells throughout the entire investor community is just crazy. Everybody who ever bought Enron Stock saw it going up, so they wanted to continue to see it going up. It is just like the whole world was making so much money, at least on paper, from this happening that why would you ever want it to stop happening?

The FTX fraud has dominated headlines now for weeks, during which we’ve debated if and how Acquired could uniquely add to the conversation. Then we realized there was an angle so perfect that we had to drop everything and enter Acquired research overdrive: Enron. Travel back with us to the granddaddy fraud of them all, 2001’s then-largest bankruptcy in US history and the impetus for the famous Sarbanes-Oxley Act. So much of Enron’s history parallels FTX that the uncanniness is almost unbelievable — right down to the same CEO running the two bankruptcies. Sit back and enjoy this crazy tale of villainy, greed, and the nature of humans and money. Maybe just don’t take notes on this one…

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