Enron's Lea Fastow Sentenced to One Year in Prison

Signaling they have bigger fish to fry, federal prosecutors and attorneys for Lea Fastow seem to have struck a deal to end the government’s criminal case against the wife of former Enron Corp. chief financial officer Andrew Fastow. The Wall Street Journal reported she will spend no more than 12 months in prison on a charge of filing a false tax return.

Update: May 6, 2004. On Thursday, Fastow, the 42 year old mother pleaded guilty to a tax charge and was sentenced to one year in prison. Prosecutors want the cooperation of her husband, former Enron Chief Financial Officer Andrew Fastow. He pleaded guilty to two felony charges and faces up to 10 years in prison for his role in the collapse of Enron.

As government investigators step up their probe of former Chairman and Chief Executive Kenneth Lay, they are anxious to resolve the case against Lea Fastow. An earlier deal fell apart earlier this year when a federal judge rejected the deal, saying Mrs. Fastow deserved to spend more than five months in prison followed by five months of house arrest.

Her husband faces up to 10 years in prison after pleading guilty to two felony counts related to his fraudulent conduct at Enron, the Journal reported, adding he has agreed to cooperate in the government's investigation of other top former officials, including Lay.

The Fastow’s deals were designed to ensure that at least one of them would be home with their young sons while the other is in prison. Mrs. Fastow had been heading toward a June 2 trial until last week’s deal was apparently reached. She could have faced several years in prison.

Last week the government filed a superseding criminal case against Mrs. Fastow on the single misdemeanor charge of filing a false tax return. Previously, she had faced up to six felony counts, including conspiracy. Prosecutors had alleged she assisted her husband in his illegal activities at Enron.

Prosecutors are vigorously investigating Lay, seeking possible criminal charges against him, the Journal reported. Among other possible charges, the government is looking into Lay’s activities in late 2001when the company was forced into bankruptcy. Investigators are trying to find out whether or not Lay lied to the public about the company’s condition.

Lay's attorney, Michael Ramsey, acknowledged to the Journal that the government has been actively investigating his client. He said he remains confident Mr. Lay did nothing illegal and that there is no basis to bring criminal charges against him. Andrew Weissmann, head of the Justice Department's Enron Task Force, declined to comment, the Journal reported.

You may like these other stories...

IRS must take oath on Lerner emails: judgeMackenzie Weinger of Politico reported on Thursday that a federal judge ordered the IRS to explain under oath how it lost emails connected to Lois Lerner, the ex-IRS official at the...
The Republican-controlled House of Representatives passed a bill on Friday morning that would permanently extend the bonus depreciation tax break for businesses.The measure, HR 4718, which was crafted by Representative Pat...
The Republican-led House of Representatives is expected to pass a bill this week that would permanently extend the bonus depreciation tax break. But don’t expect President Obama to sign it.The Obama administration said...

Upcoming CPE Webinars

Jul 16
Hand off work to others with finesse and success. Kristen Rampe, CPA will share how to ensure delegated work is properly handled from start to finish in this content-rich one hour webinar.
Jul 17
This webcast will cover the preparation of the statement of cash flows and focus on accounting and disclosure policies for other important issues described below.
Jul 23
We can’t deny a great divide exists between the expectations and workplace needs of Baby Boomers and Millennials. To create thriving organizational performance, we need to shift the way in which we groom future leaders.
Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.