Even as the power plant originally put up by an Enron subsidiary on the west coast of Maharashtra restarted producing power under a different management, the principal guilty men of Enron - the one time chairman and the former chief executive - were convicted of fraud in US courts last month.
They will appeal, but are likely to spend much of their remaining lives behind bars. Meanwhile, in all the recent reporting about the case, one aspect has been forgotten: Kenneth Lay, the now convicted ex-chairman of Enron, was extremely close to the Bush administration, and a major influence in the framing of energy policy under a taskforce headed by the Vice President, Dick Cheney.
Cheney has refused to part with the minutes of meetings in which Lay participated, despite demands from investigators, claiming confidentiality. What is he hiding?
In the court case, Lay and the former chief executive Jeffrey Skilling, both denied any wrong-doing in their management of Enron which, in many ways, has come to exemplify a corporate culture that enriched management at the cost of shareholders and creditors.
They argued that there was nothing fundamentally wrong with the company, and whatever wrong/fraudulent practices there were, were the sins of the chief financial officer - Fastow has already admitted guilt and is serving a long prison sentence. His testimony was important to convict M/s Lay and Skilling.
While not many tears will be shed on the fate of the two Texans, the legislation passed by the US Congress in a fit of remorse and penance about the happenings in US corporations, has already had several fallouts, many of them, perhaps, not intended.
While the efficacy of the so-called Sarbanes-Oxley Act (to be referred as "SOX", if you wish to show your familiarity with US business practices) in improving corporate governance, is still being debated, it has certainly deterred many foreign companies from listing on American exchanges.
The cost of compliance is so high that an increasing number of foreign companies (particularly Chinese) are preferring, say, London or Hong Kong to American listings. A few have even de-listed.
The Fannie Mae case, also in the United States, came to one regulatory climax last month, with a fine of $ 400 million - but more about that case in a later article.
Incidentally, the guilty men of Ahold, a Dutch company which, too, had indulged in accounting fraud on a massive scale at about the same time as Enron, were also recently convicted by Dutch courts, but escaped with suspended sentences and fairly light fines.
On the other hand, in Singapore, the chief of China Aviation Oil, was jailed for four years in the fraud which cost his employers several hundred million dollars. And, in Korea, the founder-heads of the Daewoo and Hyundai chaebols have also been jailed.
A few prestigious names in banking have also found several cases going against them in the last couple of months. J P Morgan paid more than $400 million to settle a civil suit alleging manipulation of IPOs by the investment bank during the dot com boom (other Wall Street big names will probably follow its footsteps).
To add to J P Morgan's woes, Japan's Financial Supervisory Authority ordered the bank to suspend some new business in real estate as it had not assessed properly the assets underlying its securitisation products; it is also alleged to have used real estate assets as a conduit for tax avoidance schemes.
Deutsche Bank also made a cut of $300 million in its last year's reported profit, to cover investigations into tax avoidance schemes, structured by KPMG, in which it was involved.
On this side of the Atlantic, Deutsche Bank was fined £6.4 million by UK's FSA in connection with the violation of certain regulatory principles, in its investment banking activity. And, Bawag, the Austrian trade union-owned bank involved in the Refco case, confessed to hiding losses of £1.3 billion incurred in certain speculative transactions in off-shore companies, in the late 1990s.
But to come back to Enron, a question that has baffled me is whether the rightist political/economic philosophy, as exemplified by Margaret Thatcher in the UK and Ronald Reagan and the two Bushes in the US, sanctified greed, making it almost virtuous.
The original propagator of the virtues of a market economy and its invisible hand, Adam Smith, had a different sense of social responsibility. The corruption and injustice prevalent in the former socialist democracies are no great advertisement for the moral force of that model either.
That apart, the fraudulent greed and indeed irrational behaviour of extremely generously, indeed lavishly, compensated executives in Enron and elsewhere, is surely a fit case for behavioural psychologists/economists to research. Have not seen much on this!
