Houston - Former Enron chairman Kenneth Lay, charged on Wednesday in a sealed indictment in connection with the collapse of the energy trader in 2001, surrendered to the FBI at dawn yesterday morning.
In Washington, Reuters reported late yesterday that Lay had been indicted on 11 counts, including conspiracy to commit securities and wire fraud, wire fraud in connection with false and misleading statements in employee meetings, bank fraud and false statements to banks.
"Nice of all of you to come," Lay told a crowd of reporters gathered outside the FBI office.
The highly anticipated charges came two and a half years into a methodical investigation that has produced charges against some of Lay's once most highly trusted lieutenants, including his protégé, former chief executive Jeffrey Skilling.
Lay is the highest-ranking Enron official to be charged in an investigation of the firm, once the seventh-largest US corporation by sales.
"Enron began what has now become a season of corporate fraud," said Robert Mintz, a former federal prosecutor. "Enron was first and biggest, and Ken Lay was the single most recognisable face on the Enron fraud."
Prosecutors from the justice department's Enron task force presented an indictment to Judge Mary Milloy on Wednesday, and at their request she sealed both the indictment and an arrest warrant, sources said.
"I have done nothing wrong, and the indictment is not justified," Lay said on Wednesday after learning of the indictment, which was unsealed after he surrendered to the FBI.
Prosecutors built their case with the co-operation of Enron's former chief financial officer, Andrew Fastow, who pleaded guilty in January to orchestrating an accounting fraud that included hiding Enron debt in off-the-books partnerships.
Lay was taken from the FBI office to the federal courthouse in handcuffs for a scheduled hearing before Milloy.
Lay's lawyer, Michael Ramsey, did not immediately return calls for comment.
Lay, who was also Enron's chief executive during part of his 16-year tenure, is one of several former executives sued by investors who allege they lost an estimated $30 billion (R183 billion) on their stock because of accounting fraud.
In 2001, the company filed what was then the largest bankruptcy in US history after disclosing it had misstated its finances.
Enron employees who were forced to keep company stock in their pension plans claim they lost an additional $3 billion as the company collapsed. They also sued Lay.
About two dozen former executives, including Skilling and former chief accounting officer Richard Causey, have been charged as a result of the inquiry.
A person familiar with the matter said the Securities and Exchange Commission was expected to file a civil suit against Lay.
Prosecutors have aggressively pursued the celebrity chief executive and friend and contributor to President George W Bush.
Skilling succeeded Lay as chief executive in February 2001 and resigned abruptly six months later, just weeks before the scandal surrounding the collapse broke.
But allegations against Lay were expected to focus on his actions after he resumed the role of chief executive upon Skilling's abrupt resignation in August 2001, the sources said.
Days after Skilling's resignation, Lay met Sherron Watkins, then an executive on Fastow's staff, who had sent him a memo warning of impending doom from Fastow's schemes to hide debt and inflate profits.
Skilling and Causey both pleaded innocent to charges of conspiracy, fraud and insider trading and are free on bail.