HOUSTON – Andrew Fastow, the mastermind behind financial schemes that doomed Enron Corp., was sentenced Tuesday to six years in prison by a judge who felt he deserved leniency.
Fastow, the former chief financial officer who cooperated with prosecutors in other cases related to Enron’s 2001 implosion, had agreed to serve a maximum 10-year term when he pleaded guilty in 2004.
But the judge said he deserved a lighter sentence because Fastow has been persecuted after Enron’s failure and because his family has suffered enough. Fastow’s wife already has served a year for her role in the scandal.
“Prosecution is necessary, but persecution was not,” U.S. District Judge Kenneth Hoyt said. “These factors call for mercy.”
Fastow’s attorneys had asked for a lighter sentence, citing Fastow’s admission of guilt and his help in the successful prosecution of Enron founder Kenneth Lay and the former chief executive, Jeffrey Skilling.
Rod Jordan, chairman of the Severed Enron Employee Coalition, said he was shocked and disappointed that Fastow was given a reduced sentence.
“I felt that anything less than 10 years was a slap in the face to the employees who suffered so much because of what Fastow did,” he said. Hoyt “didn’t have to stick with the agreement but I think he should have. Maybe the judge knows something I don’t. Do the crime, do the time.”
Fastow was taken immediately into custody after the judge rejected his request to turn himself in later. The judge did allow him to hug his wife, Lea, who was seated in the front row of the packed courtroom.
“I know I deserve punishment,” said Fastow, who cried before the sentencing while telling the court he was sorry for what he had done.
Fastow must serve all six years because there is no parole in the federal system. He also was sentenced to two years probation after his release from prison.
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 failing 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.
Fastow was originally indicted on 98 counts, including fraud, insider trading and money laundering. He pleaded guilty to two counts of conspiracy, admitting to running various schemes to hide Enron debt and inflate profits while enriching himself. He also surrendered nearly $30 million in cash and property.
Fastow’s wife, Lea, pleaded guilty in 2004 to a misdemeanor tax crime and served a year in prison for helping him hide ill-gotten gains from his schemes.
During his speech before sentencing, Fastow said he was ashamed for what he had done and had tried to compensate by helping prosecutors and attorneys for investors and employees who had lost money.
Talk to us
> Give us your news tips.
> Send us a letter to the editor.
> More Herald contact information.
