Kenneth Lay alive? Maybe
Why else would a judge clear his record, columnist asks.
G. Jeffrey Aaron
October 22, 2006




I sometimes hear that Elvis Presley isn't really dead, a notion supported by the alleged sightings of "The King" at various shopping malls around the United States.

I've heard the same thing about Tupac Shakur, the rap star who died in a hail of gunfire in Las Vegas 10 years ago. No one claims to have seen Tupac at a shopping mall. But the amount of music and the two feature movies released after his reported death make me think he's not really dead either.

With those two examples in mind, I advance the following theory: Kenneth Lay -- the disgraced CEO of Enron who was convicted of 10 counts of fraud, conspiracy and lying to banks in two separate cases related to the collapse of the Houston-based company he founded, who died of heart disease July 5 while vacationing in Aspen, Colo. -- isn't really dead, either.

How do I know? Why else would a federal judge decide last week to vacate Lay's conviction on fraud and conspiracy charges connected to the downfall of the once mighty energy trading company? Why would a judge make it more difficult for the government to seize $43.5 million from Lay's estate, money he stole from his company, and ensure the ill-gotten goods stay put. The answer is easy. So somebody, probably Lay, can use the money at a later date. The ruling was based on case law established in 2004 that allows convictions to be revoked if defendants die without an opportunity to appeal. The convenience makes it impossible for me to think otherwise.

It's a scheme that Hollywood dreams about. A wealthy but crooked industrialist pays big bucks to fake his death, which allows his conviction to be overturned on the basis of an obscure court case. All that remains is finding an indiscrete way to access the money.

Enron was once the seventh-largest company in the United States. However, the company imploded in December 2001 when accounting parlor tricks could no longer hide billions in debt or make failing ventures appear profitable.

When the company fell, thousands of jobs were lost, along with $60 billion in market value and more than $2 billion in pension plans. People's lives were ruined. Enron became synonymous with corporate fraud and scandal, a catalyst for similar corporate investigations and reams of new legislation and policies designed to prevent similar occurrences in other companies.

But Lay had socked away millions of dollars in protected investments. In early 2000, according to published reports, he and his wife bought about $4 million worth of variable annuities that guaranteed an annual income of about $900,000, starting next year. In Texas, the proceeds from annuity contracts are untouchable by creditors' and bankruptcy demands unless fraudulent intent can be proved. Lay's conviction did just that, but the judge's decision made it all go away and locked the money up even tighter.

With the money now safe and the annuities ready to kick in, my theory suggests that Lay has had plastic surgery to alter his appearance. Money can buy anything, including a new identity. And come February, his annuity payments will allow a continuation of the lifestyle to which he's became accustomed.

He wouldn't be the first to come up with the plastic surgery idea. In 1997, Amado Carrillo-Fuentes, wanted by American and Mexican drug agents, died on the operating table while undergoing plastic surgery and liposuction to change his appearance. Four suspects in the 1989 assassination of Colombian presidential candidate Luis Carlos Galan reportedly escaped detection by having plastic surgery.

I admit my spin on the events is a stretch. But is it any less believable than the ruling itself, which in effect clears Lay's name but does nothing for the victims of his fraud?

G. Jeffrey Aaron is the business writer for the Star-Gazette. His column about business happenings and issues appears weekly on the Sunday business page. To suggest a column topic or story idea, call him at 607/271-8288 or e-mail him at jaaron@stargazette.com.