Scandal update…

December 12, 2006

prison.jpegToday was supposed to be the day that Jeff Skilling got outfitted with an orange jumpsuit (or whatever they wear in federal prisons these days) to begin his 24-year term for his role in crashing Enron into the ground. But as the WSJ reported late yesterday, that’s been delayed while an appeals court considers whether to grant Skilling bail. In the meantime, he remains under house arrest.

Ironically enough, yesterday was also the day that Tyco (TYC) chose to file its 10-K, which had all sorts of interesting pearls on the scandal that will forever be linked to Enron, including the fact that former CFO Mark Swartz (see mugshot here) had paid the company $38 million in restitution at the end of October.

But Swartz’ former boss, Dennis Kozlowski (see his mugshot here) has been a bit more reluctant to cough up his part of the restitution — his share of the $134 million, or about $98 million, was supposed to be paid by Sept. 19, 2006 — a year after the pair had been sentenced to 8 1/3 to 25 year prison terms. In the K, Tyco says that it had to begin "collection" proceedings against Kozlowski and that on Nov. 17, the New York State Supreme Court had approved a $98 million payment that Tyco will receive at the beginning of January.

Those items were buried in Tyco’s 25-page risk-factors and legal disclosures filed late yesterday. There’s plenty of other interesting stuff in there too. Still, given that Kozlowski has complained repeatedly about being linked to Enron (including in this story that ran in the NY Post back in late October), it seems like fiting irony that Tyco chose yesterday to file its K.

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I’ll be taping a live segment for CNBC’s new web site later today on what to expect in 2007. To see the interview, click here.

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