Enron faces struggles ahead on anniversary of collapse

HOUSTON -- A year after Enron Corp.'s public facade as a thriving global energy behemoth began to crumble, only hints of those heady days remain in the company's 50-story headquarters.

Former chairman Kenneth Lay's corner office on the top floor, with its view of the city skyline is vacant.

The 2,000 workers left in the building that once housed 7,500 are consolidated on half-empty floors. The Starbucks in the lobby remains open, but lines of java lovers are rare; most of Enron's now-14,000 workers worldwide work at the company's pipelines and power plants.

The cavernous board room for 15 directors is too spacious for the current slate of just four directors, none of whom were around for the financial sleight of hand that led to Enron's demise.

Interim chief executive Stephen Cooper, a restructuring expert, uses former CEO Jeffrey Skilling's office, which faces Enron's smaller twin building. Intended to showcase its once-envied trading operation, the bankrupt company last week sold the tower for less than half its $240 million construction cost.

But what Enron, No. 7 on the Fortune 500 list two years ago, retains is the image of corporate malfeasance it earned Oct. 16, 2001, when it revealed a $618 million loss and eliminated $1.2 billion of shareholder equity.

Those revelations opened the door to an elaborate knot of partnerships and off-balance-sheet debts that quickly fueled Enron's failure.

"It would have been unthinkable to imagine the events that were about to take place," said John Abraham, a former executive with the company's broadband unit.

Wrong for years

Enron admitted that its financial statements had been wrong for years, in what became the first in a string of corporate and accounting scandals involving companies such as Adelphia Communications, Global Crossing and WorldCom. Enron filed for bankruptcy in December, six weeks after its financial maneuvers were disclosed.

"Enron started to open the Pandora's box of all sorts of other evils, and Enron was certainly the mother of all other frauds," said John Olson, of Sanders Morris Harris, whose skepticism of Enron -- rare among analysts before the October earnings release -- drew the company's ire.