It was a natural gas and electricity company that served industries and markets. It was founded in 1985 in Omaha Nebraska, in the United States, from the union of two companies Houston Natural Gas and InterNorth, in which the manager was Kenneth Lay and then came Jeffrey Skilling, who was also held responsible for the facts. We say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essayThis company collapsed just 5 years after its creation. All this fraud started when after two weeks Lay said that the company was doing well, there were losses of 638 million euros. When the company released its third quarter 2001 results in October of that year, it revealed a black hole that caused its stock price to decline. The Securities Exchange Commission (SEC), has launched an investigation into the company and its results. Enron admitted to inflating profits and filed for bankruptcy protection on December 2 of that year. Millions of dollars of debt were found to have been hidden in a web of transactions. Government hearings and regulatory agency inquiries were followed by a criminal investigation to find those responsible for Enron's downfall. Kenneth Lay resigned as president of the company because the creditors' committee wanted him to. An investigation began by the company's auditor, then Clifford Baxter, vice president of the company until May 2001, was found dead, then the jury finds Andersen, the company in charge of the audit, guilty of obstruction of justice in case for destroying documents about the subsidiary's more than $1 billion in losses. Skilling and Lay are charged. The company's then chief financial officer, Andrew Fastow, was found guilty of criminal charges and agreed to cooperate in the investigation of the case, only for the court to give him ten years in prison. The trial began and lasted 15 weeks, during this time 54 witnesses presented their arguments and provided numerous documentary evidence which provided many details about the financial situation that led to the collapse of the company. Those responsible for the Enron scandal, Ken Lay and Skilling, were convicted of fraud and deception. The founder and CEO at the time faced 45 to 275 years in prison. As a result, this case was the largest in a series of scandals that affected the reputation of multinational corporations in America relative to the world. Furthermore, the United States Congress created tougher legislation, known as the Sarbanes-Oxley Act, which imposed higher requirements in business accounting matters. . Ultimately he left $31.8 billion in debt, his shares lost all value, and 21,000 people around the world were left without work. Enron emerged from bankruptcy protection in 2004 and has long attempted to sell its assets to continue paying creditors for its mistakes. Please note: this is just an example. Get a custom paper from our expert writers now. Get a Custom Essay By analyzing this case we learned that we must always be waiting for the auditors and they should not be connected with the client auditors and cannot work as a consultant. Having a “strong” company, or saying that it is doing well, does not mean that we will trust the financial results only through those comments, we always need to investigate a little more.