Enron chief accountant pleads guilty

The former top accountant of fallen US energy giant Enron has pleaded guilty
to securities fraud, in a move that could see him testify against the company’s
chairman and chief executive at their high-profile trial next month.

Richard Causey told a court hearing yesterday that he would plead guilty in
exchange for a possible seven-year jail sentence.

And as part of the plea bargain it now looks likely that Causey will testify
against his former bosses, according to the BBC.

As a result of Causey’s plea, the trial of Enron’s former chairman Kenneth
Lay and former president Jeff Skilling has been put back from 17 to 30 January.

Earlier this month Lay blamed his chief financial officer Andrew Fastow
entirely for the fraud that brought down the energy giant in 2001.

Speaking at a business lunch in Houston, Lay said his trust in Fastow was
entirely misplaced and that he bitterly regretted it.

Lay faces seven conspiracy and fraud charges concerning the collapse of the
company with multibillion-dollar debts, but has always protested his innocence.

Fastow pleaded guilty to similar criminal charges last year and is expected
to testify against Lay at his trial.

The energy trading giant collapsed three years ago with massive debts and was
the most significant of the wave of US financial scandals. The company’s
collapse contributed significantly to the collapse of its auditor, Andersen.

Shortly after Causey’s arrest last year, one of his lawyers said his client
had done ‘absolutely nothing wrong’, the BBC reported.

By agreeing to testify against his former bosses, Causey should receive a
much lesser prison sentence than he would if convicted on all counts.

According to the plea bargaining deal. he will serve seven years and forfeit
$1.25m (£0.7m).

But if prosecutors are satisfied with his cooperation, they can request his
sentence be reduced to five years.