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Ex-Enron CEO Skilling launching new digital marketplace for oil investors

58 points by hhs 6y ago

gpu_explorer 6y ago
What can one person say? It is strange for this market to be similar with Enron. Keeping people in poor conditions without work is not good for so many people leaving jail. But he really hurt many.
RcouF1uZ4gsC 6y ago
From his Wikipedia page: " guilty on one count of conspiracy, guilty on one count of insider trading, guilty on five counts of making false statements to auditors, guilty on twelve counts of securities fraud " If you invest money with the guy, I think you should go for the package deal and also buy that one bridge they are selling in Brooklyn.
- Konohamaru 6y ago
  When does one decide to give people second-chances?
  - rickbutton 6y ago
    Who says everyone gets a second chance?
    - Konohamaru 6y ago
      That kind of attitude assumes you're law-abiding, civic, and righteous enough to never need one. Or you're not one of those people but nonetheless choose to reject second chances (even though there's a risk it will be used against you) in the spirit of self sacrifice for the common good.
  - manquer 6y ago
    Second chance at the same thing he got caught for ? no one would be bothered for him to become VP / consultant and advising customers like the guy in wolf of Wall Street . It is completely different when is asking people trust with him money
  - paulgb 6y ago
    Giving him a second chance means letting him out of jail, not trusting him immediately with large sums of money when he gets out.
    - WJW 6y ago
      Nobody is forced to invest with him though. It's not like the government is forcing money onto him, people can choose to invest or not. If you think the legal punishment for securities fraud should include being barred from running investment funds ever again, that is a fair position but it's not part of the law right now and it was not part of his sentence. Petition your local politician and/or run for office yourself if you feel strongly about it and want to change it. He served his sentence and when he got out he went to get a job in the field he's most experienced in. Can't really blame him for that.
  - joncrane 6y ago
    Some would argue that he made enough of his first chance to merit being passed over in the "second chance" lottery. His second chance is going and living out a quiet existence, maybe volunteering or working on his golf handicap, raising foster puppies, whatever.
  - r00fus 6y ago
    Ok, I'll bite: would you give a mass murderer a second chance? The financial/moral cost of Enron was stochastically as bad as that at least.
    - catoc 6y ago
      ... or someone who poked out one of your eyes? I mean you can't just blindly trust this guy.
  - watwut 6y ago
    Second chance in running financial operation? Probably never in this case. Normal job with little power and little ability to fraud would be fine.
  - UncleEntity 6y ago
    > When does one decide to give people second-chances? I don't think anyone is denying them a second chance but merely suggesting they probably aren't the safest option to invest your money in due to the immense amount of fraud they got up to. Fool me once, shame on you...
  - nraynaud 6y ago
    His second chance is to put groceries on the shelves under close supervision, if he can do it long enough without incident, he can be trained to be a cashier. But in a management position? I'd need 15 years of employment without incident.
- pembrook 6y ago
  Be thankful we can’t look up the worst thing you’ve done in your life on wikipedia as well. The guy paid his debt to society, let him try to do something positive with his life now. That attitude is part of the reason why the US has the worst rates of recidivism in the developed world (something like 75% I believe, whereas in northern Europe where they believe in second chances for criminals, it is closer to 25%).
  - toomuchtodo 6y ago
    He can be permitted to do something positive with his life while being prohibited from touching investor dollars or holding a position as an officer of a company public or private.
    - pembrook 6y ago
      So if I go to jail for robbing a grocery store, I should never be allowed in grocery stores again? Why let him out of jail at all if you believe he can’t be trusted?
      - karpierz 6y ago
        If you robbed a grocery store with a gun, you probably shouldn't be trusted with a gun again.
      - Larrikin 6y ago
        Grocery stores are an essential service so obviously you can't be banned from all of them. I bet the specific one you robbed bans you for life though.
      - CamperBob2 6y ago
        It depends. Why did you rob the grocery store? You were hungry? Your family was hungry? Your city water supply was toxic enough to impair your mental development? You fell under some bad influences at an impressionable age? Now, what are some possible motivations for Jeffrey Skilling's actions at Enron? Let's list a few, you go first.
sq_ 6y ago
If I were an energy investor, I would be extremely wary of anything Enron's former CEO touches. I'm honestly surprised he's trying to stay in that part of the market or even in finance at all.
filmgirlcw 6y ago
Anyone who invests in his business, as a VC or as a customer, deserves whatever calamity befalls them. I’m actually sort-of shocked there wasn’t some provision in his terms of release barring him from starting a similar type of business. He should hire Elizabeth Holmes (whose father was a low-level Enron employee himself — by all accounts he was wholly unrelated to the whole fraud thing, but it’s still funny) just to bring the 21st century con artists full-circle.
- augustt 6y ago
  Yeah it's crazy that he's allowed to do this after only being free for a year. People get their balls busted by probation for years after doing much, much less significant crimes.
- selimthegrim 6y ago
  She’s busy getting married to some mark.
vasco 6y ago
If you don't know much about Enron's history and ultimate demise I recommend giving "A conspiracy of fools"[0] a read. It's a long one but there's also an excellent audiobook available. It's very detailed, based on countless interviews and very well fact checked. If it wasn't a true story, it'd be pretty unbelievable fiction, the things management got away with. Also a cautionary tale of tying your financial stability to your employer more than strictly necessary (your salary). Most employees kept all their retirement savings as Enron stock and got burned badly. If memory doesn't fail me, the book also mentions Skilling starting to come up with plans for his follow-up venture whenever he got out of prison, shortly after being arrested - which I guess has now been published. [0] https://www.goodreads.com/book/show/29519.Conspiracy_of_Fools https://www.goodreads.com/book/show/29519.Conspiracy_of_Fool...
- filmgirlcw 6y ago
  I’d also recommend The Smartest Guys in the Room (and the documentary based on the book) [0]: https://www.goodreads.com/book/show/113576.The_Smartest_Guys_in_the_Room https://www.goodreads.com/book/show/113576.The_Smartest_Guys...
  - jgalt212 6y ago
    seconded. this doc was amazing.
lesdeuxmagots 6y ago
Well... The guy knows all about securitizing and trading energy. That said, do you really want to be buying assets from a guy who's claim to fame is how well he is able to hide the risk in esoteric or complex structured products?
- tc313 6y ago
  Andy Fastow (Enron CFO) is really the one who executed all of the structured finance shenanigans. Skilling’s sin was lying about it to investors.
  - elliekelly 6y ago
    Lying to investors is the worst sin you can commit in the eyes of the SEC.
    - WJW 6y ago
      That's why he went to jail. Hopefully he learned his lesson and won't do it again. TBF, anyone investing with him and not double checking every single word he writes deserves what is coming to them. Even then, I bet the SEC will keep a close eye on him.
MattGaiser 6y ago
> However, at least one investor who listened to his presentation was reluctant to invest in the venture because of his Enron past, that person said. Only one!??! Throw away the moral discussion of what he did. You can completely ignore it and you still must conclude that his track record is of one of destruction of investor value.
- ipsum2 6y ago
  It says at least one, not only one.
  - MattGaiser 6y ago
    Only one confirmed is still low.
    - selimthegrim 6y ago
      This reminds me of the critic’s reply to Gertrude Stein http://www.openculture.com/2013/06/gertrude_stein_a_snarky_rejection_letter_from_publisher_1912.html http://www.openculture.com/2013/06/gertrude_stein_a_snarky_r...
  - catoc 6y ago
    He also only needs one...
- smallgovt 6y ago
  The fact that many investors will outright dismiss Skilling based on his track record is exactly what would attract amoral investors. One man's trash is another man's treasure.
- rdiddly 6y ago
  One said it out loud.
deepinsand 6y ago
This idea has been tried a few times. There's a fairly liquid market for the resale of oil and gas wells already. There is also advanced software packages for analyzing the data. If the angle is exposing retail investors to these assets, it'll go as well as $USO.
hhs 6y ago
This article states: "The venture, called Veld LLC, plans to profit by charging a fee for marketing stakes in operating oil and gas wells, one of the people said, and will offer analytical data to investors interested in the well stakes. Investors can acquire holdings in between one and 10 wells, which the presentation described as “pods,” and will be sold to the investors as high-yield investments, the people familiar with the business pitch said on the condition of anonymity." What's the competitive advantage with this venture?
- MattGaiser 6y ago
  > What's the competitive advantage with this venture? I fear that it will be retail investors.
elliekelly 6y ago
How on earth was he not barred from the investment industry?
gruglife 6y ago
What could possibly go wrong?!
leeoniya 6y ago
my wife loves Tom Skilling (meteorologist for WGN 9/Chicago) Jeffrey Skilling is his younger brother: https://en.wikipedia.org/wiki/Tom_Skilling#Personal https://en.wikipedia.org/wiki/Tom_Skilling#Personal
lordnacho 6y ago
As someone who ran a hedge fund, I would be a little surprised if it turned out that people simply gave this a chance like any other investment. When you do due diligence, especially when investing other people's money, you need to be able to justify your choices. If the investment sours you don't want to be the guy who decided to invest with a convicted criminal. You also want to be doing business with "fit and proper" people, this might even be a term that shows up in various documents as a necessity (eg Premier League has such a test for potential owners). Needless to say a guy with his history isn't fit and proper. In some countries you might even be barred from serving on a board if you got convicted of this sort of thing.
- deleted 6y ago
  [deleted]
foghornleghorn 6y ago
A lot of the comments here are about investors. Think about it this way as well: if you were an engineer, would you work for Skilling? Hell, if you were anyone that did anything, would you work for him?
- CryptoBanker 6y ago
  A lot of people would if he can satisfactorily answer the question "How much are you paying?"
awillen 6y ago
#nottheonion
quantified 6y ago
“In addition to Skilling, Veld consists of a Stanford mathematician with a doctoral degree helping start the venture.“ Does Stanford teach cooking the books in the math department? I remember almost investing in Enron except I couldn’t understand how they really made money. Now that I live in CA I feel this is like announcing Jeffrey Dahmer is opening a BBQ joint.
vaxman 6y ago
"Are you smoking crack?" enron --google it before downvoting, all these ignorant people making my Karma go negative

58 points by hhs 6y ago

What can one person say? It is strange for this market to be similar with Enron. Keeping people in poor conditions without work is not good for so many people leaving jail. But he really hurt many.

RcouF1uZ4gsC 6y ago

From his Wikipedia page: " guilty on one count of conspiracy, guilty on one count of insider trading, guilty on five counts of making false statements to auditors, guilty on twelve counts of securities fraud " If you invest money with the guy, I think you should go for the package deal and also buy that one bridge they are selling in Brooklyn.

Konohamaru 6y ago
When does one decide to give people second-chances?
- rickbutton 6y ago
  Who says everyone gets a second chance?
  - Konohamaru 6y ago
    That kind of attitude assumes you're law-abiding, civic, and righteous enough to never need one. Or you're not one of those people but nonetheless choose to reject second chances (even though there's a risk it will be used against you) in the spirit of self sacrifice for the common good.
- manquer 6y ago
  Second chance at the same thing he got caught for ? no one would be bothered for him to become VP / consultant and advising customers like the guy in wolf of Wall Street . It is completely different when is asking people trust with him money
- paulgb 6y ago
  Giving him a second chance means letting him out of jail, not trusting him immediately with large sums of money when he gets out.
  - WJW 6y ago
    Nobody is forced to invest with him though. It's not like the government is forcing money onto him, people can choose to invest or not. If you think the legal punishment for securities fraud should include being barred from running investment funds ever again, that is a fair position but it's not part of the law right now and it was not part of his sentence. Petition your local politician and/or run for office yourself if you feel strongly about it and want to change it. He served his sentence and when he got out he went to get a job in the field he's most experienced in. Can't really blame him for that.
- joncrane 6y ago
  Some would argue that he made enough of his first chance to merit being passed over in the "second chance" lottery. His second chance is going and living out a quiet existence, maybe volunteering or working on his golf handicap, raising foster puppies, whatever.
- r00fus 6y ago
  Ok, I'll bite: would you give a mass murderer a second chance? The financial/moral cost of Enron was stochastically as bad as that at least.
  - catoc 6y ago
    ... or someone who poked out one of your eyes? I mean you can't just blindly trust this guy.
- watwut 6y ago
  Second chance in running financial operation? Probably never in this case. Normal job with little power and little ability to fraud would be fine.
- UncleEntity 6y ago
  > When does one decide to give people second-chances? I don't think anyone is denying them a second chance but merely suggesting they probably aren't the safest option to invest your money in due to the immense amount of fraud they got up to. Fool me once, shame on you...
- nraynaud 6y ago
  His second chance is to put groceries on the shelves under close supervision, if he can do it long enough without incident, he can be trained to be a cashier. But in a management position? I'd need 15 years of employment without incident.
pembrook 6y ago
Be thankful we can’t look up the worst thing you’ve done in your life on wikipedia as well. The guy paid his debt to society, let him try to do something positive with his life now. That attitude is part of the reason why the US has the worst rates of recidivism in the developed world (something like 75% I believe, whereas in northern Europe where they believe in second chances for criminals, it is closer to 25%).
- toomuchtodo 6y ago
  He can be permitted to do something positive with his life while being prohibited from touching investor dollars or holding a position as an officer of a company public or private.
  - pembrook 6y ago
    So if I go to jail for robbing a grocery store, I should never be allowed in grocery stores again? Why let him out of jail at all if you believe he can’t be trusted?
    - karpierz 6y ago
      If you robbed a grocery store with a gun, you probably shouldn't be trusted with a gun again.
    - Larrikin 6y ago
      Grocery stores are an essential service so obviously you can't be banned from all of them. I bet the specific one you robbed bans you for life though.
    - CamperBob2 6y ago
      It depends. Why did you rob the grocery store? You were hungry? Your family was hungry? Your city water supply was toxic enough to impair your mental development? You fell under some bad influences at an impressionable age? Now, what are some possible motivations for Jeffrey Skilling's actions at Enron? Let's list a few, you go first.

sq_ 6y ago

If I were an energy investor, I would be extremely wary of anything Enron's former CEO touches. I'm honestly surprised he's trying to stay in that part of the market or even in finance at all.

filmgirlcw 6y ago

Anyone who invests in his business, as a VC or as a customer, deserves whatever calamity befalls them. I’m actually sort-of shocked there wasn’t some provision in his terms of release barring him from starting a similar type of business. He should hire Elizabeth Holmes (whose father was a low-level Enron employee himself — by all accounts he was wholly unrelated to the whole fraud thing, but it’s still funny) just to bring the 21st century con artists full-circle.

augustt 6y ago
Yeah it's crazy that he's allowed to do this after only being free for a year. People get their balls busted by probation for years after doing much, much less significant crimes.
selimthegrim 6y ago
She’s busy getting married to some mark.

vasco 6y ago

If you don't know much about Enron's history and ultimate demise I recommend giving "A conspiracy of fools"[0] a read. It's a long one but there's also an excellent audiobook available. It's very detailed, based on countless interviews and very well fact checked. If it wasn't a true story, it'd be pretty unbelievable fiction, the things management got away with. Also a cautionary tale of tying your financial stability to your employer more than strictly necessary (your salary). Most employees kept all their retirement savings as Enron stock and got burned badly. If memory doesn't fail me, the book also mentions Skilling starting to come up with plans for his follow-up venture whenever he got out of prison, shortly after being arrested - which I guess has now been published. [0] https://www.goodreads.com/book/show/29519.Conspiracy_of_Fools https://www.goodreads.com/book/show/29519.Conspiracy_of_Fool...

filmgirlcw 6y ago
I’d also recommend The Smartest Guys in the Room (and the documentary based on the book) [0]: https://www.goodreads.com/book/show/113576.The_Smartest_Guys_in_the_Room https://www.goodreads.com/book/show/113576.The_Smartest_Guys...
- jgalt212 6y ago
  seconded. this doc was amazing.

lesdeuxmagots 6y ago

Well... The guy knows all about securitizing and trading energy. That said, do you really want to be buying assets from a guy who's claim to fame is how well he is able to hide the risk in esoteric or complex structured products?

tc313 6y ago
Andy Fastow (Enron CFO) is really the one who executed all of the structured finance shenanigans. Skilling’s sin was lying about it to investors.
- elliekelly 6y ago
  Lying to investors is the worst sin you can commit in the eyes of the SEC.
  - WJW 6y ago
    That's why he went to jail. Hopefully he learned his lesson and won't do it again. TBF, anyone investing with him and not double checking every single word he writes deserves what is coming to them. Even then, I bet the SEC will keep a close eye on him.

MattGaiser 6y ago

> However, at least one investor who listened to his presentation was reluctant to invest in the venture because of his Enron past, that person said. Only one!??! Throw away the moral discussion of what he did. You can completely ignore it and you still must conclude that his track record is of one of destruction of investor value.

ipsum2 6y ago
It says at least one, not only one.
- MattGaiser 6y ago
  Only one confirmed is still low.
  - selimthegrim 6y ago
    This reminds me of the critic’s reply to Gertrude Stein http://www.openculture.com/2013/06/gertrude_stein_a_snarky_rejection_letter_from_publisher_1912.html http://www.openculture.com/2013/06/gertrude_stein_a_snarky_r...
- catoc 6y ago
  He also only needs one...
smallgovt 6y ago
The fact that many investors will outright dismiss Skilling based on his track record is exactly what would attract amoral investors. One man's trash is another man's treasure.
rdiddly 6y ago
One said it out loud.

deepinsand 6y ago

This idea has been tried a few times. There's a fairly liquid market for the resale of oil and gas wells already. There is also advanced software packages for analyzing the data. If the angle is exposing retail investors to these assets, it'll go as well as $USO.

hhs 6y ago

This article states: "The venture, called Veld LLC, plans to profit by charging a fee for marketing stakes in operating oil and gas wells, one of the people said, and will offer analytical data to investors interested in the well stakes. Investors can acquire holdings in between one and 10 wells, which the presentation described as “pods,” and will be sold to the investors as high-yield investments, the people familiar with the business pitch said on the condition of anonymity." What's the competitive advantage with this venture?

MattGaiser 6y ago
> What's the competitive advantage with this venture? I fear that it will be retail investors.

elliekelly 6y ago

How on earth was he not barred from the investment industry?

gruglife 6y ago

What could possibly go wrong?!

leeoniya 6y ago

my wife loves Tom Skilling (meteorologist for WGN 9/Chicago) Jeffrey Skilling is his younger brother: https://en.wikipedia.org/wiki/Tom_Skilling#Personal https://en.wikipedia.org/wiki/Tom_Skilling#Personal

lordnacho 6y ago

As someone who ran a hedge fund, I would be a little surprised if it turned out that people simply gave this a chance like any other investment. When you do due diligence, especially when investing other people's money, you need to be able to justify your choices. If the investment sours you don't want to be the guy who decided to invest with a convicted criminal. You also want to be doing business with "fit and proper" people, this might even be a term that shows up in various documents as a necessity (eg Premier League has such a test for potential owners). Needless to say a guy with his history isn't fit and proper. In some countries you might even be barred from serving on a board if you got convicted of this sort of thing.

deleted 6y ago
[deleted]

foghornleghorn 6y ago

A lot of the comments here are about investors. Think about it this way as well: if you were an engineer, would you work for Skilling? Hell, if you were anyone that did anything, would you work for him?

CryptoBanker 6y ago
A lot of people would if he can satisfactorily answer the question "How much are you paying?"

awillen 6y ago

#nottheonion

quantified 6y ago

“In addition to Skilling, Veld consists of a Stanford mathematician with a doctoral degree helping start the venture.“ Does Stanford teach cooking the books in the math department? I remember almost investing in Enron except I couldn’t understand how they really made money. Now that I live in CA I feel this is like announcing Jeffrey Dahmer is opening a BBQ joint.

vaxman 6y ago

"Are you smoking crack?" enron --google it before downvoting, all these ignorant people making my Karma go negative