A couple of months again I went to a strip membership for a bachelor celebration. After I walked in, I had about $100 money in my pockets. After I walked out, not solely was all my money gone, however the one factor left in my pockets was an ATM receipt for the extra $60 I withdrew whereas contained in the membership (with a $5 strip membership ATM charge). Why did this occur? As a result of strippers are absolute Zen masters relating to extracting cash from males. It is what they have been placed on this planet to do.
However, are you able to think about a bizarro-world actuality the place as an alternative of taking cash from you, a stripper truly ended up saving you a bunch of cash? And never just a few hundred {dollars}, not just a few thousand, not just a few million, however HUNDREDS of MILLIONS of {dollars}???
Sounds insane proper? Properly, consider it or not, that is precisely what occurred to former Enron government (and alleged stripper aficionado) Lou Pai.
Lou Pai is likely to be the one particular person in historical past who truly managed to make $280 million by having an affair with a stripper, getting her pregnant after which shedding each his marriage and his extraordinarily excessive paying company job.
From Nanjing to Enron
Lou Pai was born in Nanjing, China in 1946 and moved to the USA together with his household on the age of two. His father was a math professor on the College of Maryland, Collage Park, the place Lou would ultimately earn each a B.S. and a M.S. diploma in economics. In his school years, Lou was thought-about a mathematical genius. He joined Enron in 1987 and rapidly climbed the ranks. On the time Lou joined Enron, the corporate was nonetheless a mid-sized, regional power provider. Inside a decade, each Enron and Lou Pai have been rising stars. Lou ultimately turned one in every of Enron CEO Jeff Skilling’s most trusted and highest rating executives.
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Enron Power Companies
In March of 1997, Lou was named CEO of a subsidiary referred to as Enron Power Companies (EES). The aim of EES was to promote gasoline and electrical energy instantly to private properties and companies a market costs. Consider it like this: Proper now the quantity you pay for gasoline or electrical energy is a reasonably fastened charge that’s set by a utility firm that’s in all probability a pseudo-government entity. EES needed to create another personal sector possibility that allowed customers to purchase power on the free market, direct from a utility. EES spent a small fortune on commercials across the nation trying to promote individuals on the thought of shopping for all their power instantly in a single place. By consolidating the market and permitting individuals to purchase power on an open market, EES promised to save lots of its customers 5-15% a 12 months on their power wants.
Sadly, the implementation of EES’ formidable objectives turned out to be an enormous catastrophe. Between 1997 and 2001, EES blew by $500 million in working bills with out ever producing any important revenues. Between all the numerous subsidiaries of Enron that Lou Pai ran, his tenure resulted in over $1 billion in losses.
However earlier than shit hit the fan for each EES and Enron, Lou Pai was probably the most necessary and highest paid individuals on the firm. Throughout his tenure as CEO, Lou earned roughly $100 million in wage alone. He additionally obtained huge grants of helpful Enron inventory.
Strip Golf equipment
When instances have been good, Lou Pai additionally had a repute for having fun with the Houston-area strip golf equipment. Really, Lou Pai’s penchant for strip golf equipment wasn’t a repute, it was a legend. In accordance with Bethany McLean’s wonderful guide on the rise and fall of Enron titled “The Smartest Guys within the Room”:
“Solely two issues appeared to inspire Lou Pai. Cash, and a peculiar fascination with strippers.“
Lou would reportedly go to a selected Houston strip membership (positioned not removed from Enron’s world headquarters) each night time after work. He would conduct conferences on the strip membership and deal with the highest performing salesman with wild again room events that have been all funded by his Enron company expense account. As legend has it, the strippers did not consider such a gentle mannered, nearly meek, particular person was truly a strong power CEO. So how did Lou show his identification? He allegedly would convey the strippers as much as lavish Enron workplaces the place they’d proceed the celebration late into the night time. With a view to keep away from getting caught by his wife, on his method house Lou would cease by a gasoline station and splash slightly little bit of gasoline on himself to eliminate the stripper scent.
As you may think, coming house each night time smelling like gasoline in all probability is not a sustainable way of life. And ultimately, going to strip golf equipment became a full on affair with a stripper named Melanie Fewell. Oh, and identical to Mr. Pai, Melanie additionally occurred to be married with two youngsters.
It was a large number that obtained even messier when the affair resulted in a being pregnant. When Lou’s wife discovered in regards to the being pregnant, she filed for divorce. Not solely that, round this identical time Enron had nearly reached their restrict of Lou’s strip membership bills and the key catastrophe that EES had develop into. Lou wasn’t precisely fired from Enron, however he additionally wasn’t precisely inspired to remain on as CEO of EES.
At this level, Lou Pai should have felt like he wakened in a nightmare. No extra excessive paying job, his stripper girlfriend was pregnant, his marriage was destroyed and divorce proceedings have been underway. Was Karma catching up? Properly, contemplating what occurred subsequent, I do not actually assume you’ll be able to consider Karma had any impression on Lou Pai.
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Divorce Settlement
With a view to pay the expensive monetary phrases of his divorce settlement, Lou Pai was pressured to money out 100% of his Enron inventory. Throughout a 3 week interval between Could 18 and June 7 of 2001, Lou offered off each single share he had ever been granted. He additionally exercised a number of hundred thousand Enron choices. It was in all probability laborious to do as a result of on the time, Enron was completely kicking ass as an organization and as a inventory. Enron’s all time highest value was $90.56 a share in August 2000. The common value Lou Pai obtained for his holdings between Could and June of 2001 was $72 a share. The entire worth Lou Pai was left with after each share was offered? $280 million.
Lou’s ex wife Lanna L. Pai, with whom he had two kids, was paid an undisclosed lump sum that’s believed to be within the tens of hundreds of thousands. She additionally was granted the best to the couple’s Houston mansion, a Houston rental and a $3 million home in Hawaii.
In the meantime, Lou married his stripper girlfriend, now generally known as Melanie Miller Pai. Collectively, with their new child baby, the couple moved to Colorado the place Lou turned the second largest land holder in your entire state after buying a 120 sq. mile ranch within the Sangre de Cristo mountain vary.
Timing Is Every part
Not lengthy after Lou fled to Colorado, Enron slowly began to break down as buyers started to query the corporate’s accounting practices and normal enterprise ethics. You know the way Lou Pai was capable of unload his whole stake in Enron at a median value of $72 a share? That was June of 2001. Two months later, on August 15, 2001, Enron’s share value sunk to $42. Two months later, in October, Enron dropped to $15. At this level, Enron’s prime executives like Ken Lay and Jeff Skilling have been quietly unloading huge quantities of their private shares whereas concurrently telling their very own workers and out of doors buyers that this was a GREAT time to purchase extra inventory as a result of Enron was positive to rebound imminently. Ken Lay offered off $90 million price of inventory throughout this era.
By November 28, 2001, Enron’s share value dropped all the best way all the way down to $1.
On December 2, 2001, Enron filed for chapter.
Whenever you put all of it collectively, Lou Pai is without doubt one of the luckiest individuals on the planet. By getting his stripper girlfriend pregnant, he was pressured to unload each single share of Enron he ever owned. He walked away just under the height of Enron’s inventory value with an estimated…
$280 million
His solely actual consequence got here in 2008 when he agreed in an out of court docket settlement to pay $31.5 million in civil fines and restitution to Enron’s buyers. He admitted no incorrect doing and by no means spent a second in handcuffs. As a part of the settlement, Lou Pai was barred from serving as an officer of a public firm for 5 years.
He in all probability thanks God each night time for giving him that “peculiar fascination” with strippers!
The one different one that can in all probability relate is Mikhail Prokhorov, the Russian billionaire and Brooklyn Nets proprietor who just about owes his whole $10 billion greenback fortune to a non-public jet filled with prostitutes. I guess these guys would get alongside very effectively.
