Fastow Indicted In Enron MeltdownNov 1, 2002 | USA Today In a long-anticipated move, a federal grand jury in Houston on Thursday indicted former Enron chief financial officer Andrew Fastow on 78 counts of wire fraud, money laundering and conspiracy for his role in the Enron scandal.
If Fastow is convicted, he could spend the rest of his life in prison. For each count of money laundering alone, for instance, the maximum penalty would be 10 to 20 years. Fastow also could face millions of dollars in fines.
The indictment shows that the government once criticized for going easy on financial fraud is aggressively targeting suspected white-collar criminals now.
''The investigation into Fastow's illegal activities continues,'' said Larry Thompson, the Justice Department's deputy attorney general.
The indictment covers mostly the same charges filed 30 days ago against Fastow by prosecutors with the Justice Department's Enron task force.
According to the indictment, Fastow and unnamed co-conspirators schemed to defraud Enron and its shareholders through financial deals and secretive partnerships. Fastow allegedly pocketed millions of dollars in illegal profits and enriched himself, his family and a family foundation.
The indictment also accuses Fastow of accepting kickbacks, including many $10,000 checks made out to his sons and his wife, Lea, by Michael Kopper, a former Enron financial executive. Kopper pleaded guilty to fraud and money laundering in August.
One new charge accuses Fastow of obstruction of justice, for allegedly telling Kopper to destroy and hide documents from investigators. Another new allegation: That in at least one instance, Enron used an unnamed financial institution to assist in its earnings manipulation.
In a statement, John Keker, Fastow's attorney, said: ''These charges are full of sound and fury, but the truth about Enron has yet to be told. When the truth is told to a jury of 12 honest Americans, Andy Fastow will be set free.''
Barring a plea deal, Keker is likely to seek a speedy trial for Fastow. A trial in the near future would give less time to the Justice Department to prepare witnesses and its trial strategy, says Jacob Frenkel, a former SEC attorney now at Smith Gambrell & Russell.