Corporate Irresponsibility

Enron created offshore entities, units which were used to avoid taxes which raised profits for the business. This provided ownership and management with full freedom of currency movements that would keep losses off the balance sheets. These entities made Enron look more profitable than it actually was, and created a dangerous spiral in which each quarter, corporate officers would have to work twice as hard to keep up with the deception they created in the stock market . Enron created the illusion of billions in profits while the company was actually losing money. This practice drove up their stock price to new levels, at which point the executives began to work on insider information and traded millions of dollars worth of Enron stock. The executives and insiders at Enron knew about the offshore accounts that were hiding losses for the company; however, the investors knew nothing of this. Chief Financial Officer Andrew Fastow led the team which created the off-books and manipulated the deals to provide himself, his family, and his friends with hundreds of millions of dollars in guaranteed revenue, at the expense of the corporation he worked for and its stockholders.