Conspiracy of Fools
Book

Conspiracy of Fools

A True Story

Kurt Eichenwald
Broadway Books, 2005
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Editorial Rating

9

Qualities

  • Innovative

Recommendation

You might think you know all about the Enron debacle, but this page-turner sheds new light on the scandal of the century. From Jeff Skilling's drinking and dithering to Andy Fastow's bullying and badgering, this report plumbs the depths of Enron's skullduggery. Accomplished journalist Kurt Eichenwald writes in a novelistic style, using dialogue, scenes and action to move his plot along. The result is a very complete and compelling account of Enron's collapse. At times, Eichenwald oversteps, such as when he reports what Skilling was thinking during a night of heavy drinking. While this is a lengthy tome, Eichenwald rewards those readers who keep a stiff upper lip with a fast-moving, in-depth account. getAbstract recommends this book to managers and investors who want a reminder of what happens when greed trumps common sense.

Summary

Empty Promises

In 2001, Enron exploded into the public eye as Exhibit A for corporate greed, compromised accounting and bad decisions. But the debacle took years to create. Even in the 1980s, in the earliest days of Ken Lay (the eventual CEO), Houston-based Enron was prone to missteps. Energy traders in its Valhalla, New York, office embezzled money. One wiseacre transferred money to someone named "M. Yass," a word play on "my ass," the kind of twist that would be repeated in the 1990s in the names of Enron's "special-purpose entities" (SPEs). In 1987, Lay was dumbfounded to learn that rogue traders had lost $1 billion. After discovering the fraud and overseeing an unwinding of the losses to $85 million, Lay vowed, "I promise you, we will never again risk Enron's credibility in business ventures without first making sure we thoroughly understand the risks."

Enron was no stranger to publicity errors, either. After its 1986 merger with HNG/InterNorth, Enron announced a name change to Enteron, not realizing that the word referred to the gastrointestinal tract. Later, Enron tried a new logo which was so badly designed that the E's middle prong disappeared on faxes, creating...

About the Author

Kurt Eichenwald wrote this book while working as a reporter at The New York Times. He also wrote The Informant and Serpent on the Rock.

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