P2P-Zone - View Single Post

greedy_lars · 14-01-04, 08:18 PM

Former Enron Exec Fastow Pleads Guilty
1 hour, 32 minutes ago

By KRISTEN HAYS, Associated Press Writer

HOUSTON - Andrew Fastow, chief architect of the shady, off-the-books deals that brought down Enron, pleaded guilty along with his wife Wednesday in an agreement that could take prosecutors to the top of the corporate ladder at the scandal-ridden company.

The plea bargains represent the biggest breakthrough yet in the two-year investigation into a scandal that led to the energy giant's collapse and rocked Wall Street and Washington alike.

Fastow, Enron's former finance chief, agreed to a 10-year prison sentence that will make him the highest-ranking executive to do time in the case. He also agreed to forfeit $23.8 million and help the government build a case against the executives who once occupied Enron's most opulent top-floor office suites: former chairman Kenneth Lay and former CEO Jeffrey Skilling.

"I and other members of Enron senior management fraudulently manipulated Enron's publicly reported financial results," Fastow, 42, said in a statement, adding that the purpose was to mislead investors and inflate the company's stock price and credit rating.

Fastow's wife, Lea, pleaded guilty to filing false tax returns related to Enron's ill-gotten gains. Lea Fastow, also 42, was Enron's assistant treasurer.

Andrew Fastow, clad in a gray suit, showed no emotion during the proceeding but flashed a smile afterward as he prepared to leave with his attorneys. He did not speak to reporters. His wife was not seen in the courtroom, though his parents and brother sat in the packed gallery.

Without a plea, he would have gone to trial on 98 counts of fraud, money laundering, insider trading and other charges.

Prosecutors say Fastow masterminded a sea of partnerships and tangled financing deals that hid Enron debt and inflated company profits while funneling millions of dollars to him, his family and selected friends. The partnerships had names like LJM (the first initials of Fastow's wife and two sons) and Chewco (after the "Star Wars" character Chewbacca).

He pleaded guilty to two counts of conspiracy to commit fraud — one covering the LJM partnership, the other involving transactions that Fastow used to pocket an estimated $45 million.

"I also engaged in schemes to enrich myself and others at the expense of Enron's shareholders and in violation of my duty of honest services to those shareholders," Fastow said.

Lea Fastow's deal calls for a five-month prison sentence and a year of supervised release, including five months of house arrest. But U.S. District Judge David Hittner will decide later whether to accept the sentencing deal. She still has the right to withdraw the plea.

The plea negotiations had stalled last week after Hittner refused to guarantee her a five-month prison sentence — a condition that Fastow's attorneys did not like.

The final deal calls for the same prison time, and Hittner still has the right to alter Lea Fastow's sentence, which the family insisted on to ensure that their two young sons have at least one parent at home.

"There really is life after Enron for all of us, we believe, and we're trying to get through this process the best we can," said Lea Fastow's lawyer, Mike DeGeurin.

Some experts believe Andrew Fastow's plea could break open the case against Lay and Skilling.

"Unquestionably, this is the breakthrough that the government has been pursuing," said Robert Mintz, a former federal prosecutor and an expert in white-collar crime. "There is nobody besides Fastow who can make this case for the government and that's why they have been pursuing him for so long and so aggressively."

When asked if prosecutors expected more indictments, Leslie Caldwell, head of the Justice Department unit investigating the company's downfall, did not answer directly.

"The investigation is very active and this is a significant development which I expect will yield results," Caldwell said.

"This is very significant to the Enron Task Force because whatever Andrew Fastow knows about what went on the the 50th floor, the Enron Task Force will now know as well," she said.

Lay and Skilling have steadfastly maintained their innocence. Lay's attorney, Michael Ramsey, said Wednesday that Lay has no worries if Fastow tells the truth.

Bruce Hiler, Skilling's attorney, said his client had done nothing to merit charges. "We understand the pressure to enter a plea rather than stand trial in the poisoned atmosphere that has been created around Enron, but that doesn't change the truth as to my client," he said.

Enron declared bankruptcy in December 2001 amid mass layoffs, leaving investors and retirees stuck with worthless stock. In the following months, WorldCom, Global Crossing, Adelphia Communications and others suffered a similar fate as investigators uncovered a raft of accounting failures across corporate America.

Enron was the nation's seventh-biggest company in 2001, and its bankruptcy was the largest such filing in U.S. history at the time. Its stock once traded at above $90, but sank to mere pennies amid the collapse.

Enron also became a source of ammunition for Democrats because of President Bush's close ties to Lay, a major campaign backer.

Fastow said through his lawyers when he was initially charged in October 2002 that he never believed he was committing any crime.

"Enron hired Andy to arrange off-balance sheet financing. Enron's board of directors, its CEO, and its chairman, directed and praised his work. Accountants and lawyers reviewed and approved his work," his lead attorney, John Keker, told reporters at the time.

Fastow and Lay, among others, declined to testify before a U.S. House committee looking into the Enron collapse, but Skilling did answer questions in February 2002. He said he knew of no problems at Enron when he abruptly resigned in the summer of 2001, citing family reasons

source

--------------------------------------------------------

like wow, the wheels of justice are turning? i guess 10 years with no parole is better than just walking free, but i tend to doubt Kenny boy will get in any trouble, as he is so close to Cheney and Bush, why 'little Kenny' as Bush used to refer to him, is the largest contributer to Bushs campaign funds.

edit..ya know, this thread is about US corporations cheating, stealing, and fucking people over. is that political?

14-01-04, 08:18 PM	#16
greedy_lars everything you do Join Date: Dec 2000 Location: wlll come back around to you Posts: 3,982	Former Enron Exec Fastow Pleads Guilty 1 hour, 32 minutes ago By KRISTEN HAYS, Associated Press Writer HOUSTON - Andrew Fastow, chief architect of the shady, off-the-books deals that brought down Enron, pleaded guilty along with his wife Wednesday in an agreement that could take prosecutors to the top of the corporate ladder at the scandal-ridden company. The plea bargains represent the biggest breakthrough yet in the two-year investigation into a scandal that led to the energy giant's collapse and rocked Wall Street and Washington alike. Fastow, Enron's former finance chief, agreed to a 10-year prison sentence that will make him the highest-ranking executive to do time in the case. He also agreed to forfeit $23.8 million and help the government build a case against the executives who once occupied Enron's most opulent top-floor office suites: former chairman Kenneth Lay and former CEO Jeffrey Skilling. "I and other members of Enron senior management fraudulently manipulated Enron's publicly reported financial results," Fastow, 42, said in a statement, adding that the purpose was to mislead investors and inflate the company's stock price and credit rating. Fastow's wife, Lea, pleaded guilty to filing false tax returns related to Enron's ill-gotten gains. Lea Fastow, also 42, was Enron's assistant treasurer. Andrew Fastow, clad in a gray suit, showed no emotion during the proceeding but flashed a smile afterward as he prepared to leave with his attorneys. He did not speak to reporters. His wife was not seen in the courtroom, though his parents and brother sat in the packed gallery. Without a plea, he would have gone to trial on 98 counts of fraud, money laundering, insider trading and other charges. Prosecutors say Fastow masterminded a sea of partnerships and tangled financing deals that hid Enron debt and inflated company profits while funneling millions of dollars to him, his family and selected friends. The partnerships had names like LJM (the first initials of Fastow's wife and two sons) and Chewco (after the "Star Wars" character Chewbacca). He pleaded guilty to two counts of conspiracy to commit fraud — one covering the LJM partnership, the other involving transactions that Fastow used to pocket an estimated $45 million. "I also engaged in schemes to enrich myself and others at the expense of Enron's shareholders and in violation of my duty of honest services to those shareholders," Fastow said. Lea Fastow's deal calls for a five-month prison sentence and a year of supervised release, including five months of house arrest. But U.S. District Judge David Hittner will decide later whether to accept the sentencing deal. She still has the right to withdraw the plea. The plea negotiations had stalled last week after Hittner refused to guarantee her a five-month prison sentence — a condition that Fastow's attorneys did not like. The final deal calls for the same prison time, and Hittner still has the right to alter Lea Fastow's sentence, which the family insisted on to ensure that their two young sons have at least one parent at home. "There really is life after Enron for all of us, we believe, and we're trying to get through this process the best we can," said Lea Fastow's lawyer, Mike DeGeurin. Some experts believe Andrew Fastow's plea could break open the case against Lay and Skilling. "Unquestionably, this is the breakthrough that the government has been pursuing," said Robert Mintz, a former federal prosecutor and an expert in white-collar crime. "There is nobody besides Fastow who can make this case for the government and that's why they have been pursuing him for so long and so aggressively." When asked if prosecutors expected more indictments, Leslie Caldwell, head of the Justice Department unit investigating the company's downfall, did not answer directly. "The investigation is very active and this is a significant development which I expect will yield results," Caldwell said. "This is very significant to the Enron Task Force because whatever Andrew Fastow knows about what went on the the 50th floor, the Enron Task Force will now know as well," she said. Lay and Skilling have steadfastly maintained their innocence. Lay's attorney, Michael Ramsey, said Wednesday that Lay has no worries if Fastow tells the truth. Bruce Hiler, Skilling's attorney, said his client had done nothing to merit charges. "We understand the pressure to enter a plea rather than stand trial in the poisoned atmosphere that has been created around Enron, but that doesn't change the truth as to my client," he said. Enron declared bankruptcy in December 2001 amid mass layoffs, leaving investors and retirees stuck with worthless stock. In the following months, WorldCom, Global Crossing, Adelphia Communications and others suffered a similar fate as investigators uncovered a raft of accounting failures across corporate America. Enron was the nation's seventh-biggest company in 2001, and its bankruptcy was the largest such filing in U.S. history at the time. Its stock once traded at above $90, but sank to mere pennies amid the collapse. Enron also became a source of ammunition for Democrats because of President Bush's close ties to Lay, a major campaign backer. Fastow said through his lawyers when he was initially charged in October 2002 that he never believed he was committing any crime. "Enron hired Andy to arrange off-balance sheet financing. Enron's board of directors, its CEO, and its chairman, directed and praised his work. Accountants and lawyers reviewed and approved his work," his lead attorney, John Keker, told reporters at the time. Fastow and Lay, among others, declined to testify before a U.S. House committee looking into the Enron collapse, but Skilling did answer questions in February 2002. He said he knew of no problems at Enron when he abruptly resigned in the summer of 2001, citing family reasons source -------------------------------------------------------- like wow, the wheels of justice are turning? i guess 10 years with no parole is better than just walking free, but i tend to doubt Kenny boy will get in any trouble, as he is so close to Cheney and Bush, why 'little Kenny' as Bush used to refer to him, is the largest contributer to Bushs campaign funds. edit..ya know, this thread is about US corporations cheating, stealing, and fucking people over. is that political?