Paper Tiger
WSJ's Weil the first to get a good whiff of Enron's money trail
By Will Ryan

Financial reports and other documents cascade down Jonathan Weil's desk at The Wall Street Journal.

Jonathan Weil (‘91) sits at his cramped, two-drawer desk in The Wall Street Journal’s temporary office space, awaiting final information from eleventh-hour settlement negotiations between Arthur Andersen and the Justice Department. Intermittent phone calls trickle in from fellow Journal reporters in Chicago and Washington, D.C., who have been milking Andersen sources throughout the day.

Since early this year, when it became clear that the sunken Enron was going to pull down the accounting firm, Weil said that long hours and late deadlines have been the norm for him and his colleagues. They have, literally, been on “Andersen death-watch.”

The past six months have been a test of resolve for the Journal. On Sept. 11, the paper was forced from its New York City office building across the street from the World Trade Center site. More disturbing was the kidnapping and brutal murder of the South Asian bureau chief, Daniel Pearl, two months ago. But despite those events, there have been reasons of late to be positive. One of which is the recent acclaim the paper has received for its lead role in uncovering the Enron scandal.

For his part, Weil, 31, recently has been recognized in journalistic circles as the reporter to break the Enron story. This despite claims by some press sources – most notably the Journal’s Pulitzer rivals, The Washington Post and The New York Times – that Bethany McLean’s March 2001 Fortune Magazine article was the first to raise questions of the company’s accounting practices. But in Weil’s September 2000 Texas Journal article, headlined “Energy Traders Cite Gains, But Some Math Is Missing,” he first laid bare the murky “mark to market” accounting practices being used in the late 1990s by energy trading companies such as Enron and Dynegy.

Although Weil’s experience and research have made him a top choice among his editors to continue covering the unraveling Enron saga and its many spinoffs, he said he would much rather get on with his passion for “uncovering” the news. The reporting he said he is doing now is mostly post-mortem. “I want to do predictive stories. I would much rather break a story on a company when its stock is riding high and try to protect people,” Weil said.

Weil is a self-taught financial sleuth with seemingly endless reserves of ideas and the motivation to pursue them. Investigative financial exposés are his trademark, and he obviously takes enormous pride in his unflagging research to grind through the convoluted mazes of balance sheets, tax documents and analyst reports to decipher a company’s true financial fitness level. “There’s probably only about 12 other people around the country doing what I’m doing, and I like to think I’m doing it better than they are,” he said.

Weil, born and raised in Florida, was an editor for the Campus Press and went on to successful reporting internships with the Boulder Daily Camera, The Denver Post and, after graduation, The Wall Street Journal. Having dreamt of a law degree since he was 13, Weil said he left his Journal internship to attend Southern Methodist University Law School, earning both his degree and Texas licensure in 1995.

But after school, Weil said he decided against pursuing a legal career and returned to journalism. He had graduated in the middle of his SMU class and said he knew that a path to success in the super-competitive legal profession would be unlikely.

“Whatever I do, I want to be at the top of my field, bar none. Because I have a passion for journalism that I don’t have for law, by definition my income opportunities are going to be higher,” he said.

Weil said he interned briefly with The Dallas Morning News and then took a full-time reporting job with the Arkansas Democrat-Gazette in Little Rock. At the independent paper, which he fondly described as “quirky,” Weil said he made a name for himself by breaking several scathing stories about the personal finances of then-governor and self-proclaimed pauper Mike Huckabee. In 1997, he left the Democrat-Gazette for the short-lived Texas Journal, a weekly, stand-alone insert for Texas editions of The Wall Street Journal. While working for the publication, he said he honed his financial reporting skills, often revisiting themes of inflated corporate earnings and shady accounting practices. His hard work and talent earned him a spot in the Journal’s New York office in October 2000. As it turned out, he said that his Enron article, the last he had written for the Texas Journal, probably helped persuade the Journal’s editors to assign him to the more senior-level accounting beat over a less prestigious “small stocks” beat.

Despite the issues raised by his groundbreaking article, Weil and the Journal’s editors did not pursue the investigation of Enron further.

“It was a year from when I wrote that story until I wrote something else on Enron, and that was a mistake by me,” he said. “When I look back at my stories during that year, I was reporting on things that were just as important. But in the end, they just weren’t as sexy.”

Weil said he now considers that some of the information he was being fed by Enron officials in 2000, particularly the extent of the company’s long-term energy contracts, was misleading. Whether pursuing Enron further was an oversight on his part, or whether the story just needed to play out, Weil cannot be accused of the same bull market cheerleading and gushing that other financial journalists and analysts participated in during Enron’s high times. Weil said he is a skeptic and champion of the shareholder’s right to truthful information. He said he holds dear the basic economic principal that “a public company’s first responsibility is to its shareholders” and that he uses that ideal to guide his decisions every day.

His said his philosophy toward investigative journalism stems from his days of playing both sides of the line for his high school football team. He said his coach used to tell him, “To protect yourself, you have to hit the other guy as hard as you can,” and he uses that approach when taking on corporate giants such as Enron and Andersen.

“You have to throw everything you’ve got at them. It’s no different than if that 310-pound guy is standing across the ball from you,” he said.

Weil also stressed the importance he places on accuracy when going after such high-stakes stories: “If there’s a slight scintilla of a question that something you did is wrong, they’ll come at you. You have to be 100 percent right.”

In the near future, Weil said he plans to continue doing what he loves – digging where other reporters won’t and scoring the big scoop. He said he doesn’t rule out the possibly of writing a book down the road but is leery of knee-jerk deals, such as the $1.4 million, quick-deadline variety landed by Fortune’s McLean. In his view, there is still too much information coming to light about the whole situation to write a “definitive” account, even six months from now.

“I’m not ready for it,” he said. “I want to live through four or five of these stories first.”