Ex-Enron Chief Says He Is Victim of ‘Wave of Terror’

Former Enron Corp. Chairman Kenneth L. Lay said Tuesday that he was the victim of a “wave of terror” by prosecutors and blamed his former chief financial officer for the energy company’s spectacular downfall.

In a preview of his defense at his criminal trial next month, Lay, in a speech to a Houston group, said he was only to blame for trusting Andrew S. Fastow, Enron’s finance chief, who has pleaded guilty to charges and will be the government’s key witness against Lay and co-defendants.

“We did trust Andy Fastow, and sadly, tragically, that trust turned out to be misplaced,” Lay said.

Lay, former Chief Executive Jeffrey K. Skilling and former Chief Accounting Officer Richard A. Causey will face criminal trial in January for charges brought in the aftermath of the collapse of the energy trader.

Lay also took aim at the Department of Justice’s Enron Task Force, which he said launched a special investigation against him even before there was evidence of any crimes.

“In this trial, apparently unlike most criminal defense cases, defendants are trying to get the truth in, and the prosecutors, the Enron Task Force, are trying to keep it out,” he said.

Lay called on former Enron employees to help him in presenting the truth about Enron. “Whether it will continue to be submerged by a wave of terror by the Enron Task Force will be determined by former Enron employees.”

Enron filed for bankruptcy protection in 2001 after the company’s use of off-balance-sheet accounts to hide tens of billions of dollars in debt was revealed.

The company emerged from bankruptcy protection late last year and is disposing of its remaining assets to pay back creditors, who are expected to receive only a tiny fraction of what they are owed.

Lay faces seven charges for conspiracy and fraud.

He will face a separate trial in which he is accused of illegally using bank loans to buy Enron stock.