The issue with the company in 1997

involved the misappropriation of moneys by two traders.

In 1987 two oil traders made bets for Enron

on whether the price of oil would rise or fall.

Oil trading is like gambling:

Sometimes you win, sometimes you lose.

But Enron Oil always seemed to win,

much to Ken Lay's delight.

I tried to explain to Ken Lay

the tremendous risk that you have in that market.

You can lose...

ten times your original investment.

A veteran trader, Mike Muckleroy,

was suspicious of Enron Oil's steady high profits.

Well this oil trading business had profits

that nobody could really understand and in fact,

that many of Ken Lay's lieutenants questioned.

They said this business can't be making

this much money legitimately.

Something weird is going on.