The Ethics Of Enron Scandal

1017 Words Feb 17th, 2016 5 Pages
The Dilemma Often an ethical dilemma does not appear abruptly but can rather be the proverbial slow boiling of a frog as they say. Enron was an economic powerhouse in the early to late 90’s. Its financial success was due to a great understanding of the opportunities available in the energy market due to deregulation across the country. The company was founded on sound financial principles which turned to illegal recklessness over time. Key personnel succumbed to unethical pressures which built up slowly over time. Since the public’s trust of professionals in the accounting industry is paramount to society (Mastracchio et. al. 2015) this paper will discuss the ethics not exhibited in the Enron scandal which came to a head in 2001.
History
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Fastow was ultimately indicted on 98 criminal charges which involved conspiracy and money laundering for his involvement in off balance sheet financing activities. Many other of the company’s accounting leadership were also charged. The company which was once listed at number seven on the Fortune 500 list was finally liquidated.
The Winners and Losers Many people were hurt by this event, and not many if anyone benefited. Enron reported 21,000 workers in the year 2000. As a result of off balance sheet debt all of these workers were now unemployed. Many had staked their life on this company and lost their pensions and time investment in the company as a result. The workers families were proportionately devastated as well. The community now had an overabundance of unemployed workers all vying for similar jobs in the area. Stockholders watched as their financial stake in the company quickly evaporated to worthlessness. The public in general was also hurt. Before its fall Enron was a pioneer and crucial leader in the venture of renewable energy. The damage done to what breakthroughs could have been is incalculable. The stock market as a whole took damage as investor’s confidence was shaken. The sentiment of the public was that if this could happen to a powerhouse such as Enron then how could other companies be trusted? Next people in key leadership’s positions had their lives ruined as they were tried, indicted, and

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