The Enron Corporation of Houston Texas was the result of two Houston companies merging together in 1985. Up until that point, Enron had been struggling financially and continued to struggle after the merge until the deregulation of the electrical power markets took effect, and the company redefined its business from energy delivery to energy broker (Ronald, 2). In doing this Enron was able to begin making trades and contracts while profiting off of them. Workers were held by high expectations Chief Executive Officer Jeffry Skilling, which in turn gave the company a great work output. These employees worked so hard that they began to push the limits of ethical conduct so much so that it went unnoticed as they were chasing their success. This overlooked ethical conduct is what helped Enron succeed in becoming the biggest and fastest growing corporation America had ever seen to later filing for bankruptcy in
just a single month. This bankruptcy, however, would not happen for many years. With the companys growing success Enron was able to conceal any red flags investors might have. They created partnerships as an easy way to raise money, kept their debt hidden from analysts to ensure that the company was still thriving, and encouraged workers to invest in the companys stocks. One of Enrons biggest crimes was committing accounting fraud with the help of Arthur Andersen. He did this by having his employees destroy important documentation regarding the Enron audit (Nelson). With the crimes of the Enron Company and Arthur Andersen exposed, the Sarbanes-Oxley Act of 2002 was put into place. This act was meant to monitor and regulate corporation audits so that theft and fraud could be avoided. To understand more about this act, it is first important to understand more about the Enron scandal and the ethics behind it.