Bush Enron's Lay was generous, but betrayed trust

WASHINGTON, July 7 (Reuters) US President George W Bush on Thursday called convicted Enron Corp. founder Ken Lay, who died this week, a ''generous person,'' but said he had betrayed the trust of shareholders.

Lay died of heart disease on Wednesday while on vacation in Colorado, six weeks after being convicted of fraud and conspiracy in the financial scandal that brought down the energy conglomerate.

Lay, a former confidant of Bush's father, and called ''Kenny boy'' by the current president, was once a major contributor to the Bushes' political campaigns.

Bush, speaking in an interview with CNN's ''Larry King Live,'' yesterday said he knew Lay ''pretty well'' and called him a ''good guy'' he had gotten to know while governor of Texas.

''One of the things I respected him for was he was such a contributor to Houston's civil society. He was a generous person,'' Bush said. ''I'm disappointed that he betrayed the trust of shareholders.'' The president said he had not contacted Lay's wife yet, but planned to write her a letter.

Lay, 64, was facing decades in prison in connection with Enron's 2001 bankruptcy. Lay and another former Enron chief executive, Jeffrey Skilling, were found guilty of hiding the financial ruin at Enron, which they had built into the seventh largest company in the United States.

REUTERS DH PC0845