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1Enron’s ScandalRasmussen UniversityA276/ACG2680 Financial InvestigationRoxanne VisserMaria Ocampo May 30th, 2021
2The fraudulent activity Enron performed in simple words was keeping liabilities off the balance sheet so that financial statements look good. This act allowed for Enron’s stock price to increase year over year and maintain good investment credit ratings. To keep liabilities off the balance sheet Enron’s executives started to establish special-purpose entities where liabilities were placed. This is generally allowed by GAAP, but companies must consolidate liabilities to onefinancial statement and Enron did not. Enron filed bankruptcy early December 2001. It became the largest Chapter 11 bankruptcy ever recorded before WorldCom. An approximate 4,000 jobs were lost, and thousands of employees lost their pensions and 401k because theywere tied to Enron’s stocks (Thomas, 2002). The total loss was more than $60 billion dollars.The main key players were indicted for numerous counts of accounting fraud. Most of the people involved were