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To: Sully- who wrote (60535)	1/14/2004 4:03:30 PM
From: Sully-	Read Replies (1) \| Respond to of 65232

Former Enron CFO Fastow Pleads Guilty on 2 Counts Wednesday, January 14, 2004 HOUSTON — Former Enron (search) CFO Andrew Fastow (search) on Wednesday pleaded guilty to two counts of conspiracy and agreed to cooperate with authorities in their criminal investigation of the energy giant's collapse in 2001. Fastow pleaded guilty to conspiracy to commit wire fraud and conspiracy to commit securities fraud. He agreed to a ten-year prison sentence. His wife Lea, a former Enron treasurer, was expected to plead guilty to tax fraud later in the day as part of a joint deal that prosecutors hope will help prosecute other former top Enron executives, Kenneth Lay (search) and Jeffrey Skilling (search), authorities said. Neither Lay nor Skilling has been charged; both maintain their innocence. "Unquestionably, this is the breakthrough that the government has been pursuing" to possibly lead them to Lay and Skilling, said Robert Mintz, a former federal prosecutor and an expert in white-collar crime. "There is nobody besides Fastow who can make this case for the government and that's why they have been pursuing him for so long and so aggressively." Lawyers for the government and for Lea Fastow had been expected to appear before U.S. District Judge David Hittner on Wednesday for a routine hearing to discuss potential jurors in her criminal trial set for Feb. 10. The Houston Chronicle first reported the Fastows' plea agreements in its online edition Tuesday evening. A plea deal with Lea Fastow snagged after Hittner balked at a requirement that he sentence her to five months in prison for her alleged role in the accounting schemes. The judge insisted he retain the right to alter her sentence. The issue threatened a proposed package of plea agreements for both the Fastows, who have two young sons. Under federal sentencing guidelines, Hittner will consider a prison term of 10 months to 16 months for the tax charge, said Kirby Behre, a former federal prosecutor in Washington, D.C. The judge could depart from that range, and a 10-month sentence could be structured so that only half would be served in prison. U.S. District Judge Kenneth Hoyt, who is presiding over Andrew Fastow's case, will accept his plea, sources have said. Andrew Fastow, who was indicted in October 2002, is charged with 98 counts of insider trading, fraud, money laundering, tax violations and others for allegedly running a complicated web of partnerships and financing methods that hid debt, inflated profits and funneled millions of dollars to him, his family, friends and colleagues. His wife is charged with six counts of conspiracy and filing false tax forms. She is accused of helping her husband make one partnership appear independent of Enron so the company would continue receiving related tax benefits. Michael Kopper, Fastow's one-time top lieutenant at Enron, led prosecutors to Fastow when he pleaded guilty to conspiracy in August 2002. Fastow was indicted two months later, and his wife was indicted last May. The day after Kopper's plea, a federal judge froze more than $23 million in bank and brokerage accounts held by the Fastows, their family foundation, his brother, several former Enron employees and two holding companies. Also frozen was $3.9 million from the 2002 sale of a three-story, 11,493-square-foot mansion the Fastows built in Houston's wealthiest neighborhood, River Oaks, where Skilling and Lay live. Behre called a 10-year sentence for Andrew Fastow "excellent" — given that "what drives sentencing is predominantly the amount of the fraud." Fastow is accused of pocketing at least $45 million from the Enron deals. Since Fastow could get a prison sentence of at least 20 years if convicted at trial, 10 years is "as close to a sweet deal you can have in this kind of case," Behre said. Fox News' Anna Stolley, Reuters and The Associated Press contributed to this report. foxnews.com