Kenneth Lay, the former chairman and CEO of the energy giant Enron who died yesterday, apparently of a heart attack at 64, was a confidant of congressmen and mentor to President Bush until his name became synonymous with corporate abuse and accounting fraud following the collapse of his corporation in 2001.

In just 15 years Enron had grown under Lay’s guidance from nowhere to be America’s seventh largest company, employing 21,000 staff in more than 40 countries. But the firm’s success turned out to have involved an elaborate scam.

From early on, under Lay and Jeffrey Skilling (who took over as CEO in February 2001), Enron sought to build profits by trading in gas futures, in effect becoming an energy “bank” by providing guaranteed quantities at set prices. In the early years, when prices were favorable, they raked in the profits. Soon they diversified into other products, including water, steel and even broadband capacity.

By inventing new markets and dominating them before the regulators knew what was going on, Enron kept the cash flooding in. Buoyed by success, it took gambles that could not be justified by its core business, and came to rely heavily on complex transactions based on revenue streams far into the future. But when the gambles went wrong or prices went against it, Enron devised a network of fraudulent “partnerships” to keep debts off the balance sheet.

Some of these scams were set up by Enron executives and their families, benefiting them to the tune of millions of dollars at the same time as they were selling Enron’s inflated shares. Meanwhile, losses were being shuffled round the corners of Lay’s corporate empire.

By early 2001, however, questions were being asked in the press and at the Securities and Exchange Commission; and in October 2001 Enron (and its auditors Arthur Andersen) had to admit to a $1.2 billion hole in its balance sheet. A little over six weeks later, with shares that had once traded at $90 reduced to less than $1, Enron declared itself bankrupt.

In 2004 Lay was indicted by a grand jury on 11 counts of securities fraud and related charges. He and Skilling, were accused of repeatedly lying to investors and employees about the company’s financial state before its collapse. Both men denied any wrongdoing, blaming the company’s failure on bad publicity and a loss of market confidence.

In May this year, Lay was found guilty of all but one of the charges after a four-month trial. He was expected to have faced the prospect of spending the rest of his life in prison, and was due to be sentenced on September 11.

The son of a Baptist preacher and some-time store owner, Kenneth Lee Lay was born on April 15, 1942, in Tyrone, Mo. After studying at the University of Missouri-Columbia, he took a doctorate in economics at the University of Houston. After a stint in Exxon, he joined the U.S. Navy, serving in the Vietnam War and at the Pentagon.

In the 1970s, Lay worked as a federal energy regulator and at the Federal Power Commission; he was also deputy under-secretary for energy in the Interior Department. But by the 1980s, he had moved into the private sector, as an executive at Florida Gas, then Transco Energy in Houston, before becoming CEO of Houston Natural Gas Corp in 1984. The next year he led the corporation into a merger with the Nebraska-based Inter-North to form Enron, of which he became chairman and CEO in 1986.

Lay became one of America’s highest paid executives. He was once quoted as having a fortune of $400 million. A campaigner for deregulated energy markets, he forged close business and political ties to Republican (and, to a lesser extent, Democrat) officials, taking on James Baker and Robert Mossbacher when they left the administration of George Bush Sr. He served on the President’s Council on Sustainable Development under Bill Clinton, and became a mentor to the younger Bush (who called him “Kenny Boy”), supporting him in his bid to become governor of Texas. In 1999, Bush deregulated the Texan electricity market.

The following year Lay was one of the biggest contributors to the Bush presidential campaign, during which both Mr. Bush and Dick Cheney made use of Lay’s personal Enron jet to travel from rally to rally on the campaign trail. According to Kurt Eichenwald, author of “Conspiracy of Fools,” an account of the Enron saga, Mr. Bush nearly selected Lay to be Secretary to the Treasury following his victory.

Enron’s bankruptcy, the biggest in American history when it was filed in December 2001, cost 21,000 employees their jobs and many their life savings. Investors lost billions and the collapse led to a crisis of confidence in America’s entire corporate sector.

Lay was a regular churchgoer and a devoted family man, and belonged to many philanthropic associations, donating millions of dollars to worthy causes. Before the scandal broke, he was revered by the same Enron employees he helped to ruin.

He is survived by his second wife, Linda, and by five children.