Ex-Enron CFO Pleads Not Guilty
Former Enron Corp. Chief Financial Officer Andrew S. Fastow on Wednesday pleaded not guilty to charges he masterminded a fraud that cost investors billions of dollars.
Indicted on 78 counts, the 40-year-old former executive faces as many as 20 years in prison on each of the most serious charges. Fastow is accused of enriching himself through fraud and money laundering and attempting to cover up the accounting scandal as it triggered the energy company’s collapse.
“Your honor, in answer to each of the charges, I am not guilty,” Fastow said.
Enron sought bankruptcy protection in December after restating more than $586 million in earnings.
Its collapse destroyed employee retirement accounts and cost more than 4,500 workers their jobs.
Fastow, the highest-ranking executive charged in the case, is refusing to cooperate with the government’s investigation, prosecutors say.
Fastow has been free on a $5-million bond since he was first charged Oct. 2. A pretrial conference is scheduled for Jan. 13 before U.S. District Judge Kenneth Hoyt.
Enron evolved from an interstate pipeline company into the world’s largest energy trader. It reported annual revenue of more than $100 billion, with interests in electricity, natural gas, telecommunications and water.
Fastow was in his mid-30s when he created and ran partnerships for the energy trader that brought him more than $30 million and hid $1 billion in debt, a report for the company’s board of directors has alleged.
He was ousted as chief financial officer a year ago after Enron revealed partnerships he controlled, including LJM Cayman and LJM2 Co-Investment, had cost the company millions of dollars. LJM2 filed for bankruptcy protection in September.
But Fastow’s attorneys have said everything their client did was approved by top Enron executives and that Fastow does not believe he committed any crimes. The only executives over Fastow during that time were former Chief Executive Jeffrey K. Skilling and former Enron Chairman Kenneth L. Lay.
Justice Department officials said they are seeking to freeze $21 million of Fastow’s assets. The Securities and Exchange Commission has said it would try to force Fastow to surrender “ill-gotten gains,” including his salary.
