On August 16, 2001, Enron Chairman Kenneth Lay stood before employees in a company-wide meeting, attempting to calm growing concerns about the company’s future. Just two days earlier, CEO Jeffrey Skilling had abruptly resigned, citing personal reasons. With Enron’s stock already in decline and questions swirling about the company’s financial health, Lay reassured employees that everything was under control. He even encouraged them to invest more in Enron stock, insisting that its value was poised for a rebound.
What employees didn’t know at the time was that Enron was already on the brink of collapse. While Lay was urging workers to buy shares, he was secretly selling off millions of dollars' worth of his own stock. Public filings later revealed that between August and October 2001, Lay unloaded more than $70 million in Enron stock, using the proceeds to cover personal loans.
For employees who took Lay’s advice and put their savings into Enron shares, the consequences were devastating. Just over three months later, on December 2, 2001, Enron filed for Chapter 11 bankruptcy, the largest corporate bankruptcy in U.S. history at the time. Thousands of employees lost their jobs, and many saw their retirement funds wiped out.
The Enron scandal became a defining moment in corporate fraud, leading to congressional investigations, the dissolution of accounting firm Arthur Andersen, and the eventual passage of the Sarbanes-Oxley Act to increase financial transparency. Lay himself was later convicted on multiple counts of fraud and conspiracy, though he passed away before he could be sentenced.
For many former Enron employees, the August 16 meeting remains a bitter memory, a moment when they were misled by their own leadership, unknowingly investing in a company that was already doomed.
