Government & Politics

Troy Henry at Enron

Mayoral hopeful Troy Henry has stressed his executive experience to differentiate himself from his rivals. Indeed, Troy Henry has spent his career climbing the ranks in the private sector.

He spent more than a decade at IBM before joining Enron, where he was promoted to vice president of Enron Energy Services in January 2001. Enron collapsed in October of that year in one of the greatest bankruptcy and fraud scandals in Wall Street history. Enron Energy Services was one of many Enron divisions to file for bankruptcy.

In an interview with The Times-Picayune, Henry lamented his time at Enron:

“After a dozen years with IBM, Henry was recruited to help launch an energy-services branch at Enron. He moved his family back to New Orleans while he commuted to Houston.

As vice president for North American operations, Henry recalled putting in long hours to take “a business that was floundering and give it some direction.” But in mid-2001, Henry said he was startled to see an earnings report that appeared inflated.

Henry said he was told by superiors that Enron simply was engaging in aggressive bookkeeping with its accounting firm’s blessing. He left the company on Sept. 7, 2001, just as revelations began to emerge of a massive accounting fraud that led to Enron’s collapse in one of the largest corporate scandals in U.S. history.

“I had no idea there was anything illegal until it broke. … Unfortunately for me, I had a lot of retirement funds and stock options tied up, and I lost millions as a result of the crisis,” Henry said.”

Yet, Enron has been accused of manipulating the flow of energy in California during the energy crisis of 2000 and 2001 – while Henry was in an executive position. Enron allegedly ordered plants shut down, forcing blackouts and creating wild increases in the price of energy. Enron Energy Services would then use the specter of continued instability to sign lucrative contracts with wealthy commercial and industrial clients using the promise of price assurance. The manipulations became possible during an era of energy deregulation that spanned both the Clinton and second Bush administrations.

Though no direct evidence links Troy Henry to the opportunistic practices of Enron Energy Services as they occurred, e-mail records released during investigations of the Enron collapse indicate Henry was in a critical executive position at Enron Energy Services when it pounced on deregulated energy markets – and as it approached bankruptcy amid rampant accounting failures.

In this e-mail between disgraced Enron CEO Kenneth Lay, Henry, and other executives at Enron Energy Services, it is clear that Henry was involved in recruiting priority clients at the highest levels of administration.

Another email, sent to Kenneth Lay and the board of directors from a high-level employee that had recently been laid off as the company began to unravel, details systemic problems at Enron Energy Services. The former employee alleges that Henry and another manager recruited her fraudulently, promising benefits that the company did not keep and was amazed that coffee machines were taken away to save money while Henry and other executives were permitted to commute to Houston and charge the company for luxury hotel rooms while in town to work.

Yet, she also singles out Henry out for his effectiveness and suggests he was unfairly passed over for promotions because of racism on the part of Kenneth Lay, Jeff Skilling, and other Enron executives.

One of the staple slogans of the Henry campaign for Mayor is that he has “zero tolerance for liars, cheats, and thieves.” I’m very interested to learn more about Henry’s experience at Enron Energy Services and how those experiences, positive and negative, have informed his current views on honesty and accountability.

Henry has asserted that his executive experience in the private sector is a major factor voters should consider when evaluating his candidacy. I am eager to learn more about how Henry’s experience at Enron, whatever his role, will make him a better mayor.

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