Judge backs extradition of NatWest trio to face Enron trial

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The Independent Online

Three British former NatWest bankers can be extradited to the US over their alleged involvement in a £4m fraud linked to the collapse of Enron, a UK district judge ruled yesterday. The case will now go to the Home Secretary who will decide whether they should be extradited.

Three British former NatWest bankers can be extradited to the US over their alleged involvement in a £4m fraud linked to the collapse of Enron, a UK district judge ruled yesterday. The case will now go to the Home Secretary who will decide whether they should be extradited.

Gary Mulgrew, David Bermingham and Giles Darby, all 42, said they would appeal against the decision to the High Court. They argue that as British citizens accused of defrauding a British bank, with the alleged misconduct having taken place mostly in the UK, they should be tried here rather than in Texas, the home of the failed energy giant Enron.

They have been charged with conspiracy to defraud and could face up to 35 years in prison in the US. As the former managing directors of Greenwich NatWest, the investment banking arm of the UK bank, they are alleged to have advised NatWest to sell its stake in an Enron subsidiary called LJM Swap Sub for just $1m (£550,000). It is alleged that the three each pocketed $2.3m and made a profit of more than $12m for two executives at Enron.

Mr Bermingham said of the extradition order: "It puts us at a massive and unfair disadvantage and deprives us of the basic rights of British people to be tried by their peers in Britain. We will be appealing the decision, not just for ourselves but also for others who will inevitably also be caught up by the Government's extradition law changes." He repeated his call on the US government to bring charges in the UK.

The trio's defence counsel, Alun Jones QC, said that the men had contacted the Financial Services Authority, the Crown Prosecution Service and the Home Secretary about the case, but none had decided to start an investigation in the UK. A spokeswoman for the FSA said yesterday: "We've reserved our position pending the outcome of the US proceedings." A spokesman for the CPS said the men would have to contact the police.

US prosecutors have accused the trio of seven counts of "wire fraud" - illegally gaining money via international banking systems - and each indictment carries a maximum sentence of five years in prison.

Douglas McNabb, a US criminal defence lawyer who has given evidence on behalf of the trio, said that they could each be jailed for 22 years, without the possibility of parole. That is the same sentence that Enron's former chief executive and chairman face if found guilty of multiple charges of fraud.

Mr McNabb said he was "greatly disappointed" at yesterday's decision, adding that the men would not receive a fair trial in Texas. He said: "These three British citizens, if they are ultimately extradited to the US, will not receive bond. They will be detained in a high-security federal facility, and they will have their telephone calls monitored. They will have restricted access to their lawyers."

If the men are extradited they will have to pay their own legal costs, which their spokesman put at about $2m each. Unlike in Britain, they would be unable to recover those costs and would have to sell their homes and businesses if they won in the US, Mr McNabb said. They would have to fly out, at their expense, more than 30 witnesses and pay for their accommodation and flights, and hire both US and UK legal teams.

The defendants' spokesman also said that he expects the US prosecutors to appeal if the High Court rules against the extradition, and that the case could go to the House of Lords and last "months and months".

The defendants had argued that extradition would breach their human rights, but this was dismissed by District Judge Nicholas Evans. He told the hearing at Bow Street magistrates' court: "There is a good and proper basis for prosecuting them in the US."

The trio's lawyer, Mark Spragg, said that they had been targeted early on in the Enron scandal "to implicate people further up the chain". He said the US Justice Department had contacted the men, but in order for them to get a light sentence they would have had to plead guilty to one charge - which the three refused to do.

The extradition order comes under new UK legislation which came into force in January and is designed to speed up the extradition of suspected terrorists. Under the act, US authorities are not required to present a prima facie case, while UK authorities must do so when seeking extraditions from the US.

A Home Office spokesman said: "The Home Secretary is only prohibited from ordering extradition if the death penalty might be applied, if they had earlier been extradited to the UK or if the three might be charged with any offences which were not in the extradition request."

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