Suitable for framing: Enron’s latest SEC filing
With the Bush-Kerry vote less than a month away, there’s no better time to look at Enron’s latest filing with the Securities and Exchange Commission. Enron’s new “forward-looking statement,” filed October 12, has to be the most candid, honest, and forthright corporate document ever written.
While some of Enron’s key human operatives are still at large and proclaiming their innocence, and Enron’s political pals are either keeping quiet or engaging in doublespeak about how they helped this corruption to take place, Enron the corporate entity has confessed to investors.
Yes, Enron has confessed.
In boldface type.
On one beautifully printed page produced by Enron itself and, for a change, absolutely free of charge to consumers and taxpayers.
If you like, scroll on down just a little ways and read the passage now.
But if you first want some context, here it is:
“Forward-looking statements” are mandatory in such SEC filings and in other legal documents. These cover-your-corporate-ass passages are usually typed out in all capital letters—the same communicative style that many insane people use. In SEC documents, such passages are commonly boilerplate and not particularly compelling to read, even if you’re the type to pore over corporate records.
In Enron’s case, however, the cover-your-ass days are mostly gone. Ensnarled in U.S. Bankruptcy Court in Manhattan—trading briefs instead of energy futures—Enron is a going-away concern.
Check out the company’s homepage, which says, “Enron is in the midst of restructuring various businesses for distribution as ongoing companies to its creditors and liquidating its remaining operations.” (Sorry, there are no listings for either “energy trader” or “journalist.”)
Of course, the company still has to file SEC reports. And they still must contain “forward-looking statements.” But these ain’t boilerplate.
Why read this now? Keep in mind that during the 2000 presidential campaign, Enron and its CEO, Ken Lay, were special friends of George W. Bush—and vice versa: Thanks to GOP-induced deregulation, Enron diddled Americans out of billions of dollars; its executives plowed huge amounts of money into Bush’s war chest before the company’s schemes collapsed. Forget that irrelevant nonsense about Swift boats that’s being pounded into your brains. The way that Enron mushroomed and then exploded is real and relevant. It explains a lot about why you’re in your current straits. You need details? Start with the Enron entries at Wikipedia and Disinfopedia; both sites also have copious links, including the Bush administration and Enron.
OK, you’re now ready to read the most candid corporate passage ever written. Please note the insane coincidence that it happens to be “Section 8.” Here it is:
Section 8 – Other Events
Item 8.01. Other Events.
On October 12, 2004, the Company and certain other debtor-in-possession subsidiaries of the Company (collectively with the company, the “Debtors”) filed their monthly operating report for May 2004 with the United States Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”). The monthly operating report is attached as an exhibit to this Current Report on Form 8-K.
This Form 8-K, including exhibits attached hereto, contains statements that are forward-looking within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Investors are cautioned that any such forward-looking statements are not guarantees of future performance and that actual results could differ materially as a result of known and unknown risks and uncertainties, including: various regulatory issues, the outcome of the Company’s Chapter 11 process, numerous ongoing external investigations in which the Company is fully cooperating (including investigations by the Securities and Exchange Commission (“SEC”), the Department of Justice, the Department of Labor, the Internal Revenue Service, the Pension Benefit Guaranty Corporation, the National Association of Securities Dealers Inc., the Federal Energy Regulatory Commission, the Commodity Futures Trading Commission, the Federal Trade Commission, the California and Connecticut Attorneys General, and numerous Congressional committees and state agencies), the outcome of numerous lawsuits and claims, general economic conditions, future trends, and other risks, uncertainties, and factors disclosed in the Company’s most recent reports on Forms 10-K, 10-Q and 8-K filed with the SEC.
The information contained in the Monthly Operating Report attached hereto has been prepared in accordance with applicable law under the United States Bankruptcy Code and is not to be used for investment purposes. As explained in a November 8, 2001, Form 8-K filed by the Company with the SEC, the previously issued financial statements of the Company for the fiscal years ended December 31, 1997, through 2000 and for the first and second quarters of 2001 and the audit reports covering the year-end financial statements for 1997 through 2000 should not be relied upon. In addition, as explained in an April 22, 2002, Form 8-K filed by the Company, the financial statements of the Company for the third quarter of 2001 should not be relied upon.
As explained in a July 11, 2003 Form 8-K filed by the Company with the SEC, the Company continues to believe that the existing common and preferred stock of the Company have no value. However, the proposed joint Chapter 11 plan filed by the Debtors with the Bankruptcy Court provides the Company’s stockholders with a contingent right to receive recovery in the very unlikely event that the aggregate value of the Company’s assets exceeds the total amount of allowed claims.
If I’m hearing you right, corporate citizen Enron, you just said, “We’re flat-ass busted in Bankruptcy Court, and we’re in deep shit with a whole bunch of agencies and governments and all kinds of lawyers and people. And don’t believe our past financial statements; they were bullshit. So were the reports by our auditors. Oh, and by the way, our stock is worthless, and so are your chances of getting your money back.”
Thank you for sharing, Enron. Would you like a tissue?