No Extradition Soon in Enron Case
Fri Sep 13, 8:52 AM ET
LONDON (Reuters) - Three British bankers indicted in Houston on wire fraud
charges in connection with an Enron Corp. deal are unlikely to face extradition
for some time, U.S. officials said on Friday.
Gary Mulgrew, David Bermingham and Giles Darby
were accused on Thursday by U.S. federal
prosecutors of stealing $7.3 million from a deal with
Enron, in an indictment that mirrors charges filed
against them on June 27.
The formal indictment allows prosecutors to begin
extradition proceedings to bring the men to the
United States to face trial. The men have not been
arrested yet.
A spokesman for the U.S. Embassy in London said indictment was only the
first step in a lengthy process.
The next step could be a request from the United States for provisional arrests
and extradition, a process often slowed by the need for heavy documentation
and many layers of bureaucracy in both countries.
A spokeswoman for London's Metropolitan Police said she could not comment
on any extradition orders before they had been carried out.
Bermingham, reached at home in Goring-on-Thames near London, declined to
comment on the charges.
Bohan Engineering Ltd in Wiltshire, southern England, where Darby is
managing director, said he was traveling this week and could not immediately
be reached.
Nor could Mulgrew be reached for comment.
The London-based attorney for all three, John Reynolds at law firm McDermott,
Will & Emery, declined comment.
OFF BALANCE SHEET
The deal is considered a critical piece of the case being built against former
Enron Chief Financial Officer Andrew Fastow, who is in the sights of
prosecutors and was last month implicated in several fraudulent transactions by
a former lieutenant.
Bermingham, Darby and Mulgrew allegedly siphoned the cash off via deals with
Fastow and the very first of the off-balance sheet partnerships he created and
managed -- LJM Cayman LP.
The LJM partnership and its offspring, in which Fastow held personal interests
that netted him at least $30 million while still chief fiduciary officer at Enron, led
to the Houston energy trader's collapse into a then-record bankruptcy in
December.
The indictment closely mirrors allegations first brought in a lawsuit filed in June
by Rabobank, the Netherlands' largest bank, against Royal Bank of Canada
over a $517 million Enron-related deal. Mulgrew, Darby and Bermingham joined
the Canadian firm from NatWest two years ago.
The Rabobank suit is over a separate transaction, but the plaintiffs offered the
allegation as proof Darby, Mulgrew and Bermingham -- and thus their Canadian
employer -- knew Enron engaged in sham transactions.
The alleged fraud involved Southampton LP, a financial vehicle from which
Fastow, Kopper and other Enron executives earned tens of millions of dollars
from very small investments. The bankers, prosecutors allege, secretly held an
interest in Southampton through which they received the $7.3 million.
The lawsuit alleges the transactions led to a total windfall of $21.3 million, and
possibly as much as $78.3 million, all of it siphoned from Enron and NatWest,
which participated via a partnership called Campsie Ltd.
story.news.yahoo.com
Email Story |
