WASHINGTON (Reuters) - Former Enron Corp. Chairman Kenneth Lay sold $100 million in company stock last year, including a large portion sold back to Enron after an employee warned him about an accounting debacle, a newspaper reported on Saturday.

A spokeswoman for Lay confirmed the sale on Saturday but said the transactions were motivated by a desire to pay off personal loans rather than a lack of confidence in Enron's future.

The sales included $20 million of shares sold in the three weeks after Sherron S. Watkins, an Enron official, warned Lay that the energy trading giant was in danger of collapsing "in a wave of accounting scandals."

The Houston-based company, once America's seventh-biggest, unraveled last year amid allegations it misled investors about its finances while top executives reaped huge profits by selling their holdings. Enron's collapse threw thousands out of work and wiped out many workers' retirement savings.

"Mr. Lay relinquished shares of Enron stock last year to help repay his loans," Kelly Kimberly, a spokeswoman for Lay, told Reuters in a telephone interview from Houston.

"The vast majority of the proceeds were used to repay lines of credit collateralized with Enron stock," Kimberly said, adding that the stock value had "significantly diminished."

Kimberly said she could not confirm reports that Lay's stock sales were valued at $100 million.

And she refused to describe the nature of the personal debts, saying she wanted to "keep his finances confidential for the time being as a private individual."

But Kimberly added, "Mr. Lay remained confident in Enron stock through late 2001 and his investments were primarily in Enron."

She said Lay was "surprised by the rapid decline" in Enron's stock price, which "required him to borrow money from Enron and liquidate other investments."

Lay, who this week refused to testify before Congress, asserting his Fifth Amendment right against self-incrimination, was encouraging Enron employees to buy shares as he was selling, the Times reported. It was not clear how much profit Lay made on his sales.

While most stock sales by corporate executives are required to be reported by the 10th day of the month after the sale, shares sold back to the company do not have to be disclosed until the next year. So most of Lay's sales were not revealed in the months before his company's collapse in December in the nation's biggest-ever corporate bankruptcy.

Lay resigned as chairman and chief executive of Enron on Jan. 23..