Why was Arthur Andersen indicted for obstruction of justice?

Arthur Andersen was indicted for obstruction of justice in 2002 due to the systematic destruction of documents related to the Enron audit.1

Following the anticipation of an investigation by the Securities and Exchange Commission into Enron’s financial losses, Andersen’s in-house counsel advised the firm’s Houston office to comply with its document retention policy by destroying extraneous materials. However, lead auditor David Duncan subsequently ordered his team to accelerate the destruction of documents beyond standard policy requirements.1

Between October 23 and November 8, 2001—the date the SEC formally subpoenaed the firm—an unprecedented volume of physical documents was shredded, and numerous emails and computer files were deleted. While the firm was initially found guilty of obstruction of justice for this shredding of evidence, the United States Supreme Court unanimously overturned the conviction three years later, citing faulty jury instructions. By that time, however, the firm had already effectively collapsed due to the loss of its license to practice public accounting and the mass departure of clients and employees.1