The Whistle-Blower

All over America—--and on the cover of Time magazine—--Sherron Watkins is heralded as the whistle-blower who exposed Enron's financial shenanigans. So why does the high-rolling crowd back in Houston consider her Public Enemy Number One?

WHEN ENRON WAS RIDING HIGH, in the fall of 1995, an accountant named Sherron Watkins competed in a tournament that her boss, Andy Fastow, had devised, a contest he called the Paint Ball War. The actions that would make both of them famous—Watkins as a corporate whistle-blower and Fastow as a balance-sheet manipulator—lay far in the future, but looking back on her Enron odyssey, Watkins now sees the Paint Ball War as a metaphor for all that would come to pass. Fastow was one of Enron’s brashest Young Turks then, a numbers whiz with a ferocious ambition. The Paint Ball War, in keeping with the mercenary culture of Enron, pitted his employees against a team of Enron’s outside bankers, whom Fastow often raked over the coals for failing to raise enough capital. The bankers came wanting to even the score. Fastow, however, had been transferred to a new division before the competition, and so Watkins—who worked just under him—became the prime target by default. From the moment she strode into the “war zone,” she was pounded with blue paint pellets, one hitting her hard enough to draw blood. The bankers kept striking her until, soaked with blue paint, she was pronounced dead. As she limped off the battlefield, the bankers kept firing at her. “I’m already dead!” she yelled. “Stop shooting me!”

The story of the paint ball barrage appears in the new book Power Failure: The Inside Story of the Collapse of Enron, written by Texas Monthly executive editor Mimi Swartz with Watkins. The Paint Ball War was just one manifestation of the company’s hyperaggressive New Economy culture, which

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