Andrew Fastow, the former Enron finance boss who masterminded the frauds which brought down the energy giant in 2001, will spend six years in jail for his crimes.
A Houston judge granted his plea for mercy, and declined to sentence him to the full 10 years Fastow had agreed in a plea bargain last year. His agreement to testify against his former bosses helped to secure the convictions this year of Jeffrey Skilling and the late Ken Lay, and even yesterday, in the hours before his sentencing hearing, Fastow was providing further evidence implicating seven Wall Street banks that assisted in his fraudulent deals.
Judge Kenneth Hoyt said Fastow did not deserve "persecution" for his role in the fraud that shook corporate America. "While you were painted as the ringleader, the provocateur, my investigation found that, while you were drunk on the wine of greed, you were but one of several," he said. "Prosecution is appropriate but persecution is not."
Fastow provided investors with a statement, dated yesterday, implicating Enron's former banks in the fraud he orchestrated. Investors are suing Merrill Lynch, Credit Suisse and other banks to recover $30bn (£16bn) in stock losses caused by the fraud.
A tearful Fastow, 44, hugged his wife Lea before being required to take off his belt and being led off in handcuffs.
At the trial of Lay and Skilling in the spring, Fastow said he lost his "moral compass" at Enron and expressed remorse for the losses suffered by the company's shareholders and employees. He was at the heart of a labyrinth of financial transactions that sought to hide the massive liabilities that would consume Enron. His secret side deals were so complex that he was able illegally to syphon off $45m for himself without the Enron board knowing. He allowed his wife to go to prison for a year over a false tax return filed because he hid the source of their income.
Fastow's imprisonment came on the same day as that of Bernie Ebbers, the chairman of WorldCom, whose collapse eclipsed Enron's as America's biggest-ever bankruptcy. Ebbers, 65, was sentenced to 25 years. Accompanied by his wife Christie, he drove his Mercedes the five-hour journey from his home in Jackson, Mississippi to report to the medium-security prison in Oakdale, Louisiana. He had spent his final 24 hours of freedom clinching a deal to sell more of his remaining personal assets. A fund controlled by the billionaire financier George Soros bought Ebbers' agricultural business for $32m.Reuse content