Enron founder's gift may be returned

COLUMBIA, Mo. -- University of Missouri-Columbia officials say if Enron Corp. founder Ken Lay is convicted of defrauding investors, they would prefer to remove his name from an economics professorship he endowed, which would probably require that his $1.1 million donation be returned.

In the wake of Lay's recent indictment on 11 criminal counts, including conspiracy, securities fraud and bank fraud, the Columbia Daily Tribune obtained copies of correspondence by university officials written both before and after the indictment was announced.

In one letter, Chancellor Richard Wallace said Lay, a Missouri alumnus, is willing to leave his donation with the university "so long as we keep the name on the chair."

Then in an e-mail dated July 13, about a week after Lay's indictment, Wallace wrote, "If found guilty then we would prefer to remove the name from the chair and, in accord with the terms of the endowment, we believe that this would require returning the money to Mr. Lay."

Lay received degrees in economics from the university, which established the economics chair bearing his name in 1999 after he donated Enron stock, which the university sold for $1.1 million.

In late 2001, the stock price of the energy firm crashed on news the company used questionable accounting practices to inflate earnings.