Fastow’s Shortened Sentence Sparks Surprise, Anger

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A federal judge last week shortened the prison sentence for former Enron Corp. finance chief Andrew S. Fastow from 10 years to six, prompting surprised reactions from those who thought his sentence was a done deal.

Fastow made a plea deal in 2004, agreeing to cooperate with investigators. He also agreed not to seek a reduction in his 10-year prison term for pocketing more than $45 million from the Houston energy giant. “My outcome is already determined,” he had told the court. Now, he may spend as little as 3½ years in prison if he gets credit for good behavior and for completing a drug-treatment program.

The reduced sentence “was a slap in the face to employees,” said former Enron worker Rod Jordan in the Washington Post.

Former Enron chief executive Jeffrey K. Skilling is scheduled to be sentenced on fraud charges Oct. 23. Fastow was one of the key witnesses against Skilling and founder Kenneth L. Lay, who died in July.

Daniel M. Petrocelli, a lawyer for Skilling, said in an e-mail to the Post: "What is disturbing is that in the trial against Mr. Skilling, Fastow and the prosecutors represented to the jury that Fastow would serve a minimum of 10 years," Petrocelli wrote. "Now, with the trial over, they come into court and argue for a substantially lesser sentence."

After Fastow's plea deal was struck, the U.S. Supreme Court made sentencing guidelines advisory, rather than mandatory. U.S. District Judge Kenneth Hoyt therefore had the flexibility to reduce Fastow's sentence.

Jill Ford, one of the jurors who convicted Lay and Skilling earlier this year, told the Houston Chronicle that she was upset about Hoyt's decision. “I thought 10 years was rather merciful considering he was the mastermind behind the illegal financing deals and structures," Ford said in an e-mail. "I feel like so many of the problems at Enron were directly caused by Fastow's greed. It drives me crazy thinking because he struck a deal, he will get out of 'jail' (day camp) before his kids graduate from high school.”

However, Guerra Thompson, who directs the Criminal Justice Institute at the University of Houston Law Center, called the reduced sentence a standard “reward” for helping convict others.

“Fastow was not just a good witness against Lay and Skilling, he was a great witness, giving prosecutors the compelling evidence needed to convict both top executives,” she wrote in an opinion piece in the Houston Chronicle. “And the government stands to get even more from Fastow as he continues to provide damning evidence against banks that are implicated in Enron's financial schemes.”

She also wrote, “In a very real sense, Fastow is the perfect ‘poster child' to keep the wheels of justice turning as prosecutors pursue perpetrators of all varieties of crimes in the future.”

Fastow's lawyers are asking Hoyt that Fastow be let out of the federal detention center in downtown Houston for nine hours a day, over the next three weeks, so he can give a deposition in pending shareholder litigation. The judge has not yet ruled.

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