ENRON Scandal

ENRON Scandal

The ENRON Scandal is considered to be one of the most notorious scams within American history and many historians and economists consider it to be an unofficial blueprint for a case study on White Collar Crime. By misrepresenting earnings reports while continuing to enjoy the revenue provided by the investors not privy to the true financial condition of ENRON, the executives of ENRON embezzled funds funneling in from investments while reporting fraudulent earnings to those investors. This not only proliferated more investments from current stockholders but also attracted new investors desiring to enjoy the apparent financial gains enjoyed by the ENRON Corporation.

Due to the actions of the ENRON executives, the ENRON Company went bankrupt. The loss sustained by investors exceeded $70 billion. Furthermore, these actions cost both trustees and employees upwards of $2 billion; this total is considered to be a result of misappropriated investments, pension funds, stock options, and savings plans – as a result of the government regulation and the limited liability status of the ENRON Corporation. Only a small amount of the money lost was ever returned.

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