Skilling's Ray of Hope

Remember Enron? Before Madoff, pay-for-play pension schemes, and Bank of America—before the subprime meltdown, the credit crunch, the near-collapse of the financial system and the economy—there was Enron. It was an energy company down in Texas, and it lost a lot of money in complex financial schemes that involved accounting fraud and off-balance-sheet chicanery that obscured the company's dire financial situation from investors and regulators. It went bankrupt, and it brought down accounting firm Arthur Andersen in the process. And Enron's former CEO, Jeff Skilling, was sentenced to 24 years in prison.

Now there's a ray of hope for Skilling, 55. The Supreme Court said on Tuesday that it will hear an appeal in his case. Skilling's lawyers are arguing that the doctine used to convict their client was misapplied, and that the jury was prejudiced by pretrial publicity, according to Bloomberg:

"Skilling’s appeal contends that, under a federal statute barring “honest services” fraud, prosecutors needed to show that he was aiming to advance his own interests, rather than those of the company," Bloomberg's Greg Stohr reported. If the appeal is successful, Skilling could be granted a new trial. He is currently serving his sentence at a federal prison in Colorado. In a related case, a federal judge is considering his request for a sentence reduction.

Regardless of how Skilling's appeals pan out, he is still almost sure to spend a very, very long time in jail. And that should be a grim reminder to CEOs across the land that money and influence only go so far when it comes to warding off prosecution. They can even be a liability, at a time when prosecutors and politicians are facing a populist backlash. And sometimes justice came be a long time in coming. Skilling wasn't convicted until 2006, five years after Enron sought bankruptcy protection. Based on that timetable, financial executives who were involved in the recent crisis might be enjoying the quiet before the legal storm.