The Psychology of Kenneth Lay

The Psychology of Kenneth Lay
Kenneth Lay was the CEO and Chairman of a successful energy trading company called Enron. Kenneth Lay was born April-15-1942 (Johnson, 2004). His company was widely known to have the most innovated accounting procedures. Kenneth Lay grew up as son to a religious Baptist family. Kenneth Lay is also an educated man; his highest academic achievement is a Ph.D in economics. Kenneth Lay also served the U.S Navy for around 3 years. Kenneth was brought up knowing that he had to always provide for his family. Kenneth Lay married a woman named Linda and in total they have five children. Kenneth Lay was once seen as a ?Good Man? due to his charity commitments and his dedication to the minority communities. However In today?s society Kenneth Lay is more known to be one of the biggest conspirators of the globally known pension wipe out and Freud scandal. Kenneth Lay was at the height of his career in April 2001, when Fortune magazine had claimed Enron to be the seventh largest company in the United States (G.Velasquez, 2006). However Kenneth Lay?s journey of success had a terrible downfall six month later when his company filed for bankruptcy December 2, 2001 (G.Velasquez, 2006). The claim of Enron?s bankruptcy is considered to be one of the largest corporate bankruptcies in U.S history. Throughout Kenneth Lay?s trial he still claimed that he did nothing wrong and he had no part of what happened to his company and turn the blame on Andrew Fastrow. Down the line Kenneth Lay?s company was convicted for wiping out, $60 million in market values, 56 hundred jobs, and hundreds of employee?s life savings. Kenneth Lay claimed that Fastrow was the one behind the entire operation of the pension wipe out.
Furthermore there are many theories to why one commits a crime such as Potential (ICAP) Theory, Social Control Theory and Behavioral Theory. One theory that is most intriguing to combine with criminology is Jeremy Bentham?s Rational Choice Theory. Rational choice theory is explain by stating that the person whom is about to commit the crime weighs his or her potential repercussion of their actions. More so if the award of this crime is bigger then what might be their punishment then their actions are going lean more on going through with committing the crime. Jeremy Bentham?s Rational Choice Theory places a person?s mine set and ethical values on the line for the reason they chose to follow through with committing a crime. With rational choice theory the criminal is evaluating the level of risk that a certain crime will impose.
Based on rational choice theory by Jeremy Bentham, the potential criminal does not just decide they are going to commit the crime overnight. Instead most of the crime that follows rational choice theory is planned out in every detail such as the time, day and victim (etc.). Moreover rational choice theory tries to explain that the target of the potential criminal is not chosen at random. The victims are selected with much consideration by the level of challenge they will impose on the criminal (DEREK B. CORNISH1, 2006). For instance let?s take 250 pound bully as our criminal. Now the bully is not going to pick on a person who has equal or greater strength as the bully. Instead the bully will choose someone who is 100-120 pounds and looks defenseless as their victim. This is because the bully knows they have a greater chance of getting away and coming out successful with a more defenseless opponent as appose to someone on his/her same or greater level. Under rational choice theory one can say that the criminal choose their victims that might be considered as easy targets.
Moreover no theory goes without debates of its weaknesses as well as strength. Rational theory has several weaknesses as well as strength. One of Jeremy Bentham?s rational choice theory weakness is that it has always been debated is that it has to broad of a definition. It also claims that most of the potential criminals are fully capable of thinking rationally and/or logically with the exception of the mentally ill. Furthermore it does not take into account are those crimes that considered being hate crimes, crimes of passion and emotion (etc.). There are also many criminal who rather commit crimes in the spur of the moment and do not have a detailed plan to commit the crime. It is also hard to prove that this theory is the best suited for a certain criminal. Another weakness of rational choice theory is that it is hard to combine with other aspects of ones thinking such as religious belief, and moral values. Rational theory cannot be combined with ones will power. One last weakness of rational choice theory is that the theory claims that crimes in this category are mainly economically based (Siegel, 2007).
Although there are many weaknesses to rational theory there is also strength that allows rational choice to become a theory of exploration. One of the strength of rational choice theory is that is it one of the most common explanation to human behavior (Cornish &ump; Clarke, 1986). Another strength that pertains to rational choice theory is that this theory claims that once an offender has committed a crime then their upcoming crimes become predictable. With rational theory the victims also get a theory to why they have been chosen to be victims of the perpetrators. Rational choice theory also explains that the potential perpetrator has the choice of not becoming a criminal. Many of the defenders of rational choice theory believe that one of the strength of this theory is that it creates a non-tautology prognosis.
One policy implication to prevent crime in rational choice theory is to make targets seem more unlikely to be targets. For instance instead of walking alone down an ally walk with a group of people. In neighborhoods where there is a higher likelihood of criminal acts occurring try to implement more security in place. Studies shows that neighborhoods that have security or frequent neighborhood watch in place are less likely to be a neighborhood of committed crimes (Keel, 1994). One of the actions that should be done based on rational choice theory is that once one commits a crime their sentencing should not be taken lightly since they become ?predictable?. There sentencing should be given with much consideration to what will actually be affective and leave the criminal noticing that the reward does not and in the future will not out way the punishment.
One case that Rational Choice Theory is well represented in is the case that was discussed earlier in this paper. The case of Kenneth Lay where his company called Enron had a tragic downfall. Rational choice theory explains that the perpetrator weighs the reward and the punishment before making a decision. One of the rewards that Kenneth Lay and others high in power in the cooperation received was $55 million in bonuses just a few days before claiming bankruptcy (Ingrassia, 2006). Kenneth knew that his charity work and his good reputation would follow him throughout this case (Velasquez, 2009). Kenneth believes that he could easily push the blame onto Andrew Fastrow making it more logical for him (ken) to bypass any criminal accusation. During Kenneth Lay?s trial day he continue to say that he did nothing wrong and only continue to provide for his family as his father had taught him. Kenneth felt that everything he did was for his family so he did not commit a crime even though the evidence proved that he did commit the crime. And Kenneth was indicted for his role in the company?s collapse, including 11 counts of securities fraud, wire fraud, and making false and misleading statements (Associated Press, 2006).
Throughout the last years of Enron, Kenneth Lay and Andrew Fastrow was placing small amount of money (also known as entities) into accounts with unusual names such as Jedi and Chewco. By disguising theses account they were never entered into the data systems (Velasquez, 2009). Therefore the money laundering scheme would not be easily discovered making the punishment unlikely and the reward higher and of more value. Furthermore since Kenneth was covering up the losses of the company and making investors and employees believe that the company was making profit instead drastically loosing. Kenneth knew that his investors and employees trusted him. And as long as he made it seem that the company was on the right path no one would become suspicious or question him. Therefore this allowed him to pick his target very well and plan out his entire scheme perfectly as those who fall into rational choice theory do.

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