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Fastow links Skilling to losses at Enron
(AP)
Updated: 2006-03-08 09:38
The architect of financial schemes that helped fuel the collapse of Enron
Corp. told a jury Tuesday that he had the blessing of his boss, former CEO
Jeffrey Skilling, for moves that allowed the energy trading company to hide
losses and inflate profits.
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| Former Enron Chief Financial Officer Andrew Fastow, center, leaves
the federal courthouse after testifying in the trial of Enron founder Ken
Lay and former Enron CEO Jeff Skilling Tuesday, March 7, 2006 in Houston.
Lay and Skilling are facing fraud and conspiracy charges.
[AP] |
In some of the most dramatic testimony in the sixth week of the trial, former
Chief Financial Officer Andrew Fastow said Skilling told him, "Get me as much of
that juice as you can," regarding the personally lucrative partnerships Fastow
used to manipulate Enron's finances.
Fastow appeared contrite in his much-anticipated confrontation in a federal
courtroom with Skilling and Enron founder Kenneth Lay, who are on trial for
fraud and conspiracy stemming from the spectacular 2001 collapse of what was
once the seventh-largest company in the U.S.
He fought back tears as he told jurors that his wife, Lea, pleaded guilty to
a tax crime and finished a year-long prison term last July for signing a tax
return that didn't include illegal income from business deals unrelated to the
partnerships.
Fastow pleaded guilty to two counts of conspiracy in January 2004 at her
urging, more than a year after he was originally indicted on a total of 98
charges. His plea was contingent upon the government striking a deal for his
wife, who was initially indicted in May 2003.
He said Tuesday he misled his wife, and told her the kickbacks 锟斤拷 a series of
checks written to her, him and their two young sons 锟斤拷 were gifts. She endorsed
and deposited those checks. Fastow stared at the floor as the checks, with his
wife and sons' names, were displayed for jurors Tuesday on a massive screen.
"I did this," he said, tearful and fighting to compose himself. "I led her to
believe that."
The partnerships that he said Skilling approved 锟斤拷 LJM1 and LJM2 锟斤拷 were named
with initials of his wife and sons, Jeffrey and Matthew, though Fastow didn't
share that detail with jurors. Skilling, chief operating officer at the time,
would later serve as chief executive for six months until resigning in August
2001.
Fastow said his boss enthused about the partnerships: "I love LJM. I want to
do all the deals with LJM I can. I just don't want the footnotes."
He said he took that to mean Skilling had a disdain for detailed disclosure
of the partnerships to the public. At the time, equity and credit analysts,
banks and the media were putting the company under heavier scrutiny.
Fastow, who agreed as part of his plea deal to serve 10 years in prison, is a
key pillar of the government's quest to prove Lay and Skilling lied to Wall
Street and to their own employees to conceal the crumbling finances that drove
the company to seek bankruptcy protection in 2001.
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