Remorseful Fastow gets reduction in jail term

Former chief financial officer of Enron Corporation, Andrew Fastow, yesterday got bittersome reward for his misdeed when a US District court ruled a six-year sentence for him. Fastow was one of the key figures behind the financial scam that destroyed the Houston, Texas based energy company.

Fastow, 44, who helped craft the scandal that became a symbol of American corporate greed and later made aware of his former bosses’ involvement in the wrongdoing, had earlier agreed to serve a maximum 10-year term when he pleaded guilty in 2004.

But US District Judge Kenneth Hoyt said, as Fastow had given his full co-operation to prosecutors, had pledged to help victims and had shown remorse, and his family has suffered enough, so he deserves leniency. The judge slashed the jail term by four years and sentenced him for six-year in prison followed by two years of community service.

Fastow’s wife Lea Fastow, a former Enron assistant treasurer, had gone to prison on May 6, 2004 for a year in a federal prison in Houston. Fastow's testimony helped convict former Chairman Kenneth Lay and former CEO Jeffrey Skilling. Both were charged, but Lay died of a heart failure in July, while Skilling is to be sentenced next month.

"Prosecution is necessary, but persecution was not," said Hoyt. "These factors call for mercy."

Fastow, who felt ashamed of his misdeed and broke into tears before the ruling, apologized to the victims of the Enron fraud and to his friends and family. "I know I deserve punishment and I accept it without bitterness," said Fastow.

He also said that he had tried to revive his wrongdoing by helping prosecutors and lawyers appointed by investors and employees who had lost their money in the scandal. "To all of the victims, I apologize to you," he said, turning toward the three lawyers who spoke on behalf of the three money losers and one Enron investor. "I am ashamed of what I did."

The judge allowed Fastow to hug his wife before taken away in handcuffs.

Fastow, on October 31, 2002, was accused by a federal grand jury in Houston, Texas on 78 counts including fraud, money laundering, and conspiracy. On January 14, 2004, he pledged guilty to two counts of wire and securities fraud, and accepted to serve a ten-year imprisonment. He also agreed to give his cooperation to federal authorities in the prosecution of other former Enron executives.

Enron's collapse caused investors to lose billions and eliminated thousands of jobs and retirement savings, more than US$60 billion in market value and more than $2 billion in pension plans, while Investors lost US$30 billions.

As per reports, Fastow has earned US$45-million from the off-balance sheet schemes he engineered. He has virtually surrendered all his assets to the court, totaling nearly US$24- million in cash and property.

Fastow will have likely to serve most of his six-year imprisonment under federal rules at a minimum security federal prison camp in Bastrop, Texas. Still, he could see up to a year further reduction if he enters a 500-hour drug treatment program for his reliance on anxiety medication.