NEWS and ANALYSIS
NEWS. Conner Gaydos, an Arkansas native who wrote the book Birds Aren’t Real: The True Story of Mass Avian Murder and the Largest Surveillance Campaign in US History, is behind the relaunch of energy conglomerate Enron. Gaydos, a known prankster, has listed himself on LinkedIn as the new CEO of the company and the holding company for his venture is an LLC filed in Arkansas.
Enron was the major player in the energy market back in the 1980s through the early 2000s. Through illegal accounting practices and nefarious investment strategies, the company went into bankruptcy in 2000. The company emerged a shell of its former self.
At one time Enron processed $27 billion per quarter in commodities trading through its online platform. Coming out of bankruptcy, it held only three remaining assets.
Those assets would later be sold, and Enron would morph into a company that tried to recoup as much as possible for employees and investors who lost everything they put into the company. For context, the value of Enron’s publicly traded stock fell to zero from an $11 billion valuation.
Andrew Lay and Jeff Skilling were both convicted of federal crimes relating to the fall of Enron. Also, Arthur Anderson, one of the largest accounting firms in the world, was forced to dissolved for its part in the Enron fallout. Enron’s failure inspired the Sarbanes-Oxley Act of 2002.
Gaydos, does not seem to be interested in helping with any recovery efforts. He is, however, selling Enron merchandise on the website’s company store. Gaydos appears to have no intention of restarting Enron in any legitimate business.
ANALYSIS. Enron is a great example of what not to do. A large part of its fall was caused by fraudulent accounting practices and the use of “Special Purpose Vehicles” (SPV). SPVs are a legal entity designed to bundle riskier investments and insulate them from a larger entity. If the investments in the SPV fail to produce value, the SPV can be “hung” while the company walks away insulated from the financial fallout.
One of the many ways that Enron went wrong was by using SPVs to hide Enron’s debt from showing up on the balance sheets. Enron’s debt was instead shown as an SPV, but the assets were tied to the value of the company. Think of it as sweeping the company’s debt for failed business ventures—like a water rights development company or insider trading—under a rug.
All in all, some things just aren’t funny. In case you are wondering, profiting off a criminal company at the expense of its victims is not funny.
Attorney. America First. Sued Hunter Biden for child support. Represented President Trump in the 2020 Wisconsin election challenge. Former attorney for the Wisconsin Special Counsel. An official “Tough Cookie” per President Trump.
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