Lay Finishes Testimony in Enron Trial

Earlier in the morning, Lay testified that he lost $37 million in net worth in one month in 2001 as his company's stock plummeted.

Lay also attempted to refute government charges that he tried to tamper with prosecution witnesses during the trial, saying that it has been "very difficult, almost impossible" for his lawyers to talk to potential witnesses, saying the government has intimidated them into not talking.

Lay said he was deeply in debt and sinking fast as the year went along because "90 percent" of his net worth was tied up in Enron stock.

During its cross-examination, the government attempted to show that Lay continued to live the high life through 2001 -- paying $200,000 to charter a yacht for his wife's birthday, for instance -- and drew out the last $1 million of his personal Enron credit line days before the company declared bankruptcy.

"You had a liquidity problem and Enron had a liquidity problem," Hueston said yesterday.

"Yes," Lay said.

"And you saw to it that you were taken care of before the employees were in those competing interests," Hueston concluded.

Tuesday, under examination by his defense lawyer, George "Mac" Secrest, Lay said that he emptied the credit line not to continue living it up, but merely to continue living. By November 2001, Lay testified, he was afraid he and his wife, Linda, might have to declare bankruptcy, just like Enron.

"The [Enron board of directors] was saying they wanted me to continue to lead the company into, through and out of bankruptcy," Lay testified. "I was trying to give us a little financial cushion. We were in a financial crisis as well as the company was having a financial examination."

During cross-examination, Hueston said that Lay sold more than $70 million of stock back to the company during 2001 to raise money and pay off debts -- sales that would not have to be reported until the end of 2001. Hueston maintained that Lay was intentionally hiding his massive stock dump from investors as the company spiraled down.

Hueston said that Lay had plenty of other non-Enron stock he could have sold. Lay testified Tuesday that Hueston failed to note that Lay did sell about $13 million worth of non-Enron stock during 2001.