Trial, Day 14: 'Am I breaking the law?'

In her third day on the stand in the Ken Lay/Jeff Skilling trial, ex-Enron executive Paula Rieker continued sticking by her story Thursday that Enron leaders gave a false picture of corporate health to try to boost the company's worth. However, she said she never stopped to think about whether she and others in the company were breaking the law by doing so, probably because she was making barrels of money:

She said she was "uncomfortable" and knew things were wrong and even thought several times about quitting. But she made about $3 million a year in both 2000 and 2001, including a $300,000 bonus on the eve of bankruptcy, and she just kept working at Enron despite her qualms. She stayed there until the month she pleaded guilty in mid-2004.

On questioning from [Skilling's lawyer Daniel] Petrocelli, Rieker said she very seldom spoke to Skilling. She said neither Skilling nor Lay ever directly ordered her to lie, she never agreed with them to commit crimes and she never told them or anyone at Enron that they were committing crimes.

Rieker, 51, said she knew the misrepresentations of Enron's financial health were wrong but "I didn't ask myself the hard question — am I breaking the law?" she said.

Petrocelli specifically asked Rieker about a 2000 analyst conference in which Skilling said there were $50 million in earnings and $50 million in revenue from Enron's broadband division from the sale of unused fiber optic cable, when in reality there was about $150 million in revenue that translated to $87 million in earnings from the sale. Rieker said earlier that she thought Skilling gave the wrong figures because he wanted to make it look like Enron's Internet arm was growing rather than benefiting from a one-time sale; today, she said she didn't correct Skilling because "my prior interaction with him ... had conditioned me that he didn't want to be corrected." Perhaps she was afraid Skilling would call her a dirty name.

Regarding Lay, Rieker said she told him he was overstating the Enron retail divisions' financial health in the fall of 2000 and suggested what she felt was proper disclosure about failing side deals, but Lay didn't respond. Rieker also showed some sass: At one point, Petrocelli got close to her on the stand and she asked him to step back. No word on what cologne he was wearing.

When the trial resumes Monday, prosecutors will call Wesley Colwell, the former top accountant for Enron's trading unit, to the stand. Colwell is cooperating with prosecutors, though he hasn't been charged with a crime.