Fastow a Key for Plaintiffs in Bank Suits (former Enron CFO)

[NVMojo]

October 2, 2006

Andrew S. Fastow is telling all, naming names, and the lawyers suing Enron’s former banks on behalf of investors say that his words could lead to billions of dollars in fresh settlements.

Mr. Fastow, Enron’s former chief financial officer, was sentenced last week to six years in jail for stealing from Enron and devising schemes to deceive investors about the energy company’s true financial condition. In his last weeks of freedom, he spent long days giving plaintiffs’ lawyers his account of the role that banks played in helping Enron disguise how much debt and how little cash it had.

Lawyers have already won settlements for $7.3 billion of the $40 billion investors claim they lost in Enron’s collapse. Most of that money has come from banks, like J. P. Morgan Chase, Bank of America, Citigroup and Canadian Imperial Bank of Commerce. Seven other banks have not settled.

Until now, the plaintiffs’ lawyers have had to rely primarily on documents to try to prove that banks played a central role in Enron’s false accounting. But Mr. Fastow, the Enron executive who worked most closely with the banks, has been explaining the motives for many of Enron’s bank dealings, putting them in context and recounting conversations with top bank officials, according to two plaintiffs’ lawyers and Mr. Fastow’s civil defense lawyer, Craig Smyser.

more...

http://www.nytimes.com/2006/10/02/business/businessspecial3/02enron.html?_r=1&dlbk&oref=slogin

[On the Road]

1. Ooh, If He Can Take Down More High-Level Accomplices

it might be worth giving him a six-year slap on the wrist.