The prosecution's last major witness in the fraud trial of Enron's former leaders endured six hours of hostile cross-examination, but treasurer Ben Glisan insisted that the company's financial problems were mounting even as chairman Kenneth Lay displayed optimism to the public.

"What we were telling banks, rating agencies and investors was inconsistent with economic reality," Mr Glisan said.

Mr Glisan (40) provided some of the most compelling evidence to date against Mr Lay and former chief executive Jeffrey Skilling in a confident turn on the witness stand under questioning by assistant US attorney Kathryn Ruemmler.

Earlier, he vividly described a company so unsettled by billions of dollars in losses that one executive said "he was glad he didn't have a gun, or he would shoot himself" during a bleak September 2001 meeting.

Mr Lay discussed the company's "dire" financial condition internally but misrepresented its troubles to shareholders and employees, whom he told the company was "fundamentally strong" weeks after that meeting, Mr Glisan testified. He claimed Mr Skilling knowingly worked to circumvent accounting rules in a May 2000 deal and that Mr Lay "giggled . . . in delight" at the approach.

Discrediting Mr Glisan, described as the "cleanup hitter" and "closer" by Mr Skilling's lawyer Daniel Petrocelli, is paramount to the defence case.

Prosecutors used Mr Glisan to remind the jury of their central allegations and to corroborate testimony by more personally tainted witnesses, including former finance chief Andrew Fastow. While Mr Glisan shifted in his seat, repeatedly sought to clarify statements by Mr Petrocelli and sometimes laughed in frustration during cross-examination, he did not lose his composure.

The former Enron executive already has endured much worse than a combative cross-examination. He pleaded guilty to a single conspiracy charge in September 2003 and moved directly into prison where he has spent two and a half years.

In some of the starkest testimony in this eight-week-long trial, Mr Glisan talked about the two weeks he spent in solitary confinement and of his fears of being branded a "snitch". He also spoke of facing physical threats from other prisoners. He will be eligible for release into home confinement in September.

Mr Petrocelli hammered away at the central themes of the defence case. He accused Mr Glisan of shading his testimony to win perks from the government, including half a dozen furloughs that allow him to spend time with his wife and two children. He pointed out that Mr Glisan had no explicit notes or recordings implicating Mr Skilling or Mr Lay, just his own recollections. And he noted that Mr Glisan had failed to win a deal with the government earlier because prosecutors doubted his credibility.

Mr Glisan previously acknowledged that during his tenure at Enron, he had improperly accepted $1 million (€830,000) on a fraudulent deal in which he invested less than $6,000.

In one passionate exchange, Mr Petrocelli accused the witness of "criminalising" remarks Mr Skilling made about the accounting benefits of a business partnership in 2000. Defence lawyers told the eight-woman, four-man jury in opening statements that Enron was essentially a healthy business, which collapsed amid a market panic fed by vindictive media and short sellers. "I don't know that he used the word 'circumvent' but the takeaway was . . . the only reason to do it was an accounting benefit," Mr Glisan said.

"He didn't say that in front of anybody," the defence lawyer said.

"He didn't say it in that way," Mr Glisan replied.

"I'm asking the questions," Mr Petrocelli shot back.

Testimony by Mr Glisan, who had been known inside Enron as a "boy scout", merely underscored the importance of two crucial witnesses to come. Both Mr Lay and Mr Skilling are preparing to make their own case to the jury sometime after the defence case begins next week.

"You're going to see 'em early and you're going to see 'em often and you're going to see 'em for a long time on the stand," Mr Lay's lawyer, Michael Ramsey, said outside the courthouse.