She Sounded The Alarm

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The Bill Blass design studio, led by Prabal Gurung, said they found inspiration in "the pretty young things" who spend their evenings at cocktail parties and other dressy occasions. At left, models pose at the Bill Blass Spring 2008 show on Sept. 6, 2007.
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Some colleagues look at Sherron Watkins and see "brusque" and "abrasive." Others see "straightforward" and "ethical." But neither camp is shocked about the identity of Enron's hottest author, reports CBS News Correspondent Jim Axelrod.

"I'm surprised that anybody wrote that memo," said former colleague Stephen Schwarz. "But given that it was written, I am not surprised that she is the one who wrote it."

In August, Watkins, a vice president at the energy giant, made sure Enron's chairman knew in the clearest language that his company was engaging in shady, if not illegal accounting.

"It takes a lot of guts to do what she did. It's easier just to go with the flow," said Watkins' neighbor Chris Cagley.

It's a memo that's made her the scandal's newest cover girl. It's filled with the kind of blunt and nervy language not exactly designed for sucking up to the boss.

"It would be devastating," is what she tells Chairman Ken Lay she's heard a management level employee say. "But I wish we would get caught. We are such a crooked company." In another portion of the memo she says herself, "We have a lot of smart people looking at this and a lot of accountants have blessed (it). None of that will protect Enron if these transactions are disclosed in the bright light of day."

"A chief executive who gets something like this, this detailed, this passionate, overlooks it at his peril," says former U.S. Attorney Frank Velie.

Now that she is at the center of America's biggest controversy, Watkins should get used to life under the microscope. Her motives are the first item for examination. After all, who writes the boss in language like that? And why?

For her old sorority sister, it was a matter of integrity.

"I don't think she was necessarily motivated by power, prestige or money," says Carrie Wood. "I think she was probably intellectually stimulated and loved the challenge of working there. And so it wasn't hard for her to do the right thing when it was time to do the right thing.

To a former colleague, self-interest played a role.

"My own theory is that she had to begin to protect her own professional reputation," said Schwarz.

No doubt we'll hear more about motive as the drama plays out. But for now, in an ever growing cast of villains, Sherron Watkins appears to be one Enron leader who at least tried to do the right thing.

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