Enron man faces 10-year stretch after plea-bargain

Federal prosecutors finally won their battle to persuade Andrew Fastow, the former chief financial officer of the collapsed energy giant Enron, and his wife, Lea Fastow, to enter guilty pleas yesterday for their roles in the company's demise in exchange for reduced prison sentences.

Andrew Fastow pleaded guilty to criminal charges during a court hearing in Houston yesterday. His wife later admitted to one count of filing a false tax return. The high-profile pair have been under intense pressure from the American government for more than a year to reverse their claims of innocence. Mr Fastow is described as the mastermind of the web of hidden partnerships in Enron used to disguise its true financial troubles.

Mr Fastow pleaded guilty to two charges of conspiracy and has agreed to serve 10 years in prison and to forfeit $23.4m assets, most of which have already been frozen. Prosecutors dropped another 96 counts against Mr Fastow after he agreed to help the government investigation into Enron's collapse.

Expectations are high that the deal will give prosecutors the leads they need to crack open the Enron case and possibly file criminal charges against Kenneth Lay and Jeffrey Skilling, two of its most senior former executives, who have both maintained they are innocent of any wrongdoing. Neither man has yet been charged.

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

The former chief financial officer, who was charged with multiple offences in 2002, including money laundering, tax evasion, fraud and insider trading, had resisted all attempts by prosecutors to agree to a guilty plea, insisting instead he would go to trial.

He apparently changed his mind, however, on the eve of jury selection for a separate trial for his wife, who is accused of conspiracy and filing false tax forms.

Targeting a family member is a common strategy for US prosecutors. The Fastows have two young children and it seems that it was the prospect of them being "orphaned" that led to the breakthrough. Mrs Fastow is expected to complete a five-month sentence before her husband goes to prison.

An earlier attempt to seal the guilty agreements unexpectedly stalled last week after the judge in Mrs Fastow's case objected to proposed limits on her prison sentence.

Suggested Topics
News
newsVideo targets undecided voters
Arts and Entertainment
Singer Pixie Lott will take part in Strictly Come Dancing 2014, the BBC has confirmed
tv
Life and Style
Cooked up: reducing dietary animal fat might not be as healthy as government advice has led millions of people to believe
healthA look at how governments started advising incorrectly on diets
News
Evan Spiegel, the founder of Snapchat, dropped out of Stanford University just before graduation to develop his app
techAnd yes, it is quite a lot
PROMOTED VIDEO
News
ebooksAn evocation of the conflict through the eyes of those who lived through it
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Calypso Developer

£500 - £700 per day: Harrington Starr: Calypso Developer Calypso, J2SE, XML, ...

IT Developer/Analyst

£35000 - £36000 per annum + benefits: Ashdown Group: A market leading financia...

Pricing Manager, Finance, Edinburgh, £250-350p/d

£250 - £350 per annum + competitive: Orgtel: My client, a leading bank, is cur...

Client Services Executive / Account Executive - SW London

£23000 - £26000 per annum: Ashdown Group: Account Executive / Client Services ...

Day In a Page

Kate Bush, Hammersmith Apollo music review: A preamble, then a coup de théâtre - and suddenly the long wait felt worth it

Kate Bush shows a voice untroubled by time

A preamble, then a coup de théâtre - and suddenly the long wait felt worth it
Robot sheepdog technology could be used to save people from burning buildings

The science of herding is cracked

Mathematical model would allow robots to be programmed to control crowds and save people from burning buildings
Tyrant: Is the world ready for a Middle Eastern 'Dallas'?

This tyrant doesn’t rule

It’s billed as a Middle Eastern ‘Dallas’, so why does Fox’s new drama have a white British star?
Rachael Lander interview: From strung out to playing strings

From strung out to playing strings

Award-winning cellist Rachael Lander’s career was almost destroyed by the alcohol she drank to fight stage fright. Now she’s playing with Elbow and Ellie Goulding
The science of saturated fat: A big fat surprise about nutrition?

A big fat surprise about nutrition?

The science linking saturated fats to heart disease and other health issues has never been sound. Nina Teicholz looks at how governments started advising incorrectly on diets
Emmys 2014 review: Can they genuinely compete with the Oscars

Can they genuinely compete with the Oscars?

The recent Emmy Awards are certainly glamorous, but they can't beat their movie cousins
On the road to nowhere: A Routemaster trip to remember

On the road to nowhere

A Routemaster trip to remember
Hotel India: Mumbai's Taj Mahal Palace leaves its darker days behind

Hotel India

Mumbai's Taj Mahal Palace leaves its darker days behind
10 best pencil cases

Back to school: 10 best pencil cases

Whether it’s their first day at school, uni or a new project, treat the student in your life to some smart stationery
Arsenal vs Besiktas Champions League qualifier: Gunners know battle with Turks is a season-defining fixture

Arsenal know battle with Besiktas is a season-defining fixture

Arsene Wenger admits his below-strength side will have to improve on last week’s show to pass tough test
Pete Jenson: Athletic Bilbao’s locals-only transfer policy shows success does not need to be bought

Pete Jenson: A Different League

Athletic Bilbao’s locals-only transfer policy shows success does not need to be bought
This guitar riff has been voted greatest of all time

The Greatest Guitar Riff of all time

Whole Lotta Votes from Radio 2 listeners
Britain’s superstar ballerina

Britain’s superstar ballerina

Alicia Markova danced... every night of the week and twice on Saturdays
Berlin's Furrie invasion

Berlin's Furrie invasion

2000 fans attended Eurofeurence
‘It was a tidal wave of terror’

‘It was a tidal wave of terror’

Driven to the edge by postpartum psychosis