After a series of promotions, He was finally promoted to president and chief operating officer (second only to Lay) of Enron in 1997. It was then that Skilling began advocating a novel idea: the company didn't really need any "assets." By pushing the company's aggressive investment strategy, he helped make Enron the biggest wholesaler of gas and electricity, with $27 billion traded in a quarter. On February 12, 2001, Skilling was named CEO of Enron, receiving $132 million in a single year.
After Enron's eventual collapse, Skilling was indicted on 35 counts of fraud, insider trading, and other crimes related to the collapse of Enron. He surrendered to the Federal Bureau of Investigation on February 19, 2004, and pleaded not guilty to all charges. The main reason for his arrest was his probable knowledge of the fraudulent transactions within Enron. About a month after quitting Enron, Skilling sold almost $60 million of his stake in the company (in blocks of 10,000 to 500,000 shares), leading to the prosecutors' allegation that he sold those shares with inside information of Enron's impending bankruptcy. Skilling's attorney is Daniel Petrocelli, the 52-year-old civil litigator who represented Ron Goldman's father against O.J. Simpson in civil suit. Skilling spent $40 million in preparation for the trial, at least $23 million of which going to his defense lawyers' retainer. Skilling's younger brother Mark is an attorney and assisted his legal team during the criminal trial.
The trial began on January 30, 2006 in Houston, despite repeated protests from defense attorneys calling for a change in venue on the grounds that "it was impossible to get a fair trial in Houston – the epicenter of Enron's collapse. Enron's bankruptcy, the biggest in U.S. history when it was filed in December 2001, cost 20,000 employees their jobs and many of them their life savings. Investors lost billions." When asked on the street during the trial, Skilling admitted that industrial dominance and abuse constitutes a global problem by saying: "Oh yes, yes sure, it does." On May 25, 2006, the jury found Skilling:
- 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
- not guilty on nine counts of insider trading
In a front page interview with The Wall Street Journal on 17 June 2006, Skilling claims, among other things, that: (1) he had been in a depression after the Enron bankruptcy and considered committing suicide, but that his indictment actually lifted his spirits and brought him out of his depression, (2) he states that the worst witness against him was himself, and (3) he says that he will be able to survive a long prison term - as long as he is given "something to do, something to accomplish" while in prison.
... All this from a man known for his arrogance and harsh attitude.
On October 23, 2006, Skilling was sentenced to 24 years and 4 months in prison, and fined $45 million.
Skilling began his sentence on December 13, 2006, at a low security federal prison in Waseca, Minnesota. According to the Federal Bureau of Prisons, he is scheduled for release on February 21, 2028, when he would be 74 years old.