Two of the most notorious felons to emerge from Enron Corp.'s rubble -- Jeffrey K. Skilling and Andrew S. Fastow -- could hear firsthand at their sentencing hearings how their crimes affected the people who lost money and jobs when the company crashed.
A federal judge ruled recently that victims who attend Fastow’s Sept. 26 hearing can sign in and speak. Such statements, U.S. District Judge Kenneth Hoyt ruled, “will continue until completed” and Fastow must be there to listen.
Skilling’s lawyers said in court filings that they also expected Enron victims to speak about their financial hardships at the former chief executive’s Oct. 23 sentencing hearing.
Skilling was convicted May 25 of 19 counts of fraud, conspiracy and other charges for lying to investors and employees about the company’s financial health.
Diana Peters, a former employee left jobless after Enron collapsed, said she would participate and has been spreading the word among other ex-Enron workers that they would probably be permitted to speak at Skilling’s sentencing as well.
“I am going to start writing my three minutes. I can say the most powerful stuff in three minutes,” she said, though Hoyt hasn’t specified a time limit for victim statements.
The right to be heard stems from a 2-year-old federal law that enhances the rights of victims of federal crimes -- even sprawling white-collar cases with too many victims to count.
Sen. Dianne Feinstein (D-Calif.), who sponsored the Crime Victims Rights Act with Republican Sen. Jon Kyl of Arizona, said the legislation is beginning to pay off.
“It ensures that victims can look a perpetrator in the eyes and describe the real harm that he or she caused,” Feinstein said. “This puts a real face on the crime.”
Enron, once the nation’s seventh-largest company, crumbled into bankruptcy proceedings in December 2001 after years of accounting tricks could no longer hide billions in debt or make flailing ventures appear profitable. The collapse wiped out thousands of jobs, more than $60 billion in market value and more than $2 billion in pension plans.
The law says victims have the right to be “reasonably heard” in hearings involving a defendant’s release, plea, sentencing or parole. It directs the Justice Department to make “best efforts” to ensure that victims know about such proceedings and their right to be heard, and it requires judges to ensure that they can exercise that right.
In January, the U.S. 9th Circuit Court of Appeals further interpreted “reasonably heard” to mean judges may not restrict victims to written statements if they want to speak.
“The criminal justice system has long functioned on the assumption that crime victims behave like good Victorian children -- seen but not heard. The Crime Victims Rights Act sought to change this by making victims independent participants of the criminal justice process,” said the opinion written by 9th Circuit Judge Alex Kozinski.
In Fastow’s case, Hoyt’s order says the Justice Department must publish notice of the sentencing hearing on its website as well as in newspapers distributed in Houston and nationally.
On Friday, U.S. District Judge Sim Lake, who presided over Skilling’s trial, granted the same right to victims who want to speak at the sentencings of Skilling and Richard A. Causey, Enron’s former chief accounting officer.
Causey was bound for trial alongside Skilling and Enron founder Kenneth L. Lay until he pleaded guilty to securities fraud in December. Lay, who was also convicted of fraud and conspiracy, died July 5. Causey is to be sentenced Oct. 19 and has agreed to serve seven years.
Lake’s order said that allowing potentially thousands of Enron victims to speak “could unduly prolong and complicate the sentencings of the defendants,” so those who want to participate would need to notify his staff in writing by Sept. 15. The judge said that if many people aimed to make the same points, he might limit the speakers.