Image: Former Enron chairman Kenneth Lay leaves the Bob Casey U.S. Courthouse with wife, Linda
Dave Einsel  /  Getty Images
Enron chairman Kenneth Lay and wife Linda leave court in April of 2006. Linda Lay is contending because her husband’s convictions were vacated, the government has no lawful claim on his estate.
updated 12/2/2007 3:15:08 PM ET 2007-12-02T20:15:08

The widow of Enron Corp. founder Kenneth Lay says her husband didn’t commit any crimes, according to court documents filed Friday in the ongoing effort by the federal government to seize nearly $13 million in assets from his estate.

Linda Lay’s claims were in response to an October 2006 civil action filed by federal prosecutors after her husband’s convictions for his role in Enron’s collapse were vacated following his death last year.

The civil action was the only way federal authorities could try to seize $12.7 million in assets they claim were “proceeds of the fraud proven in the criminal case against Lay.”

Kenneth Lay had been convicted in May 2006 of 10 counts of fraud, conspiracy and lying to banks in two separate cases. But his convictions were vacated because of his July 2006 death from heart disease.

Prosecutors are looking to take three things: $2.5 million of the value of the couple’s condominium in one of Houston’s most exclusive high-rises; $10.2 million from a partnership named for both the Lays; and nearly $23,000 in a bank account.

Linda Lay’s response to the civil action comes after U.S. District Judge Ewing Werlein on Nov. 14 rejected a request from her to halt the government’s bid for the money.

In the response, Linda Lay “denies any criminal activity on the part of Kenneth L. Lay, including his alleged participation in securities, fraud, wire fraud, conspiracy or money laundering.”

She also denied that any of the property or assets officials are trying to seize was involved in money laundering or acquired through criminal conduct.

Jaclyn Lesch, a Justice Department spokeswoman, declined to comment on Linda Lay’s claims.

Both Linda Lay and prosecutors have asked for a jury trial, which has not been scheduled.

Enron, once the nation’s seventh-largest company, crumbled into bankruptcy proceedings in December 2001 when years of accounting tricks could no longer hide billions in debt or make failing ventures appear profitable.

Enron’s collapse wiped out thousands of jobs, more than $60 billion in market value and more than $2 billion in pension plans.

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