A tentative plea agreement for the wife of former Enron Corp. finance chief Andrew S. Fastow may lead to a plea from Fastow himself and perhaps his cooperation into the investigation of the company’s collapse, observers say.
U.S. District Court Judge David Hittner on Thursday tentatively accepted Lea Fastow’s plea agreement, which would send the former assistant Enron treasurer to prison for five months on one count of filing a false tax return, the Wall Street Journal reported.
However, Hittner said he has "preliminary concerns" and ordered a presentencing investigation, which could take two months, to determine if the sentence is appropriate before finalizing it.
Andrew Fastow’s plea deal, being negotiated with prosecutors, would mean guilty pleas on some of the nearly 100 counts against him and 10 years of prison time in exchange for cooperation in the Enron probe, the Journal reported. Fastow was the alleged brainchild behind a series of schemes that hid Enron's debt, inflated profits and allowed him to skim millions of dollars for himself, his family and selected friends and colleagues.
Plea deals often involve agreements to testify against others, raising the possibility that cases could be brought against Enron's former top executives, Kenneth Lay and Jeffrey Skilling, who have not been charged. Both have denied wrongdoing at Enron, which collapsed in 2001.
Fastow has already provided some information on former Chief Accounting Officer Richard Causey — and a criminal complaint has been drawn up — but the information can’t be used unless Fastow’s plea agreement is approved.
Fastow plea deal is apparently contingent upon a deal for his wife. They want to avoid prison at the same time, so one of them can care for their two sons, 8 and 4.
"She has two children at home .. and five months works. Anything more than that doesn't," said Mike DeGeurin, Lea Fastow's attorney. "It is a problem because of timing. If Andy, her husband, has to go to jail at some time, we don't want the children to be without parents. For reasons I don't want to go too much into right now, five months will work." DeGeurin also said the plea bargain included "no agreement that Mrs. Fastow cooperate."
Hittner gave attorneys until noon Friday to accept his findings and said he would delay Lea Fastow's trial, scheduled for Feb. 10, if all parties agreed. DeGeurin told reporters that his client hadn't decided whether to accept the plea agreement under the conditions laid out by the judge.