May 01, 2003
Lea Fastow does the perp walk

Federal prosecutors are preparing to announce charges against seven more Enron executives, including Lea "Wife of Andrew" Fastow. Get the cuffs, Ponch!

The former executives to be named today are Ken Rice and Joe Hirko, co-chief executive officers of Enron Broadband Services; Kevin Hannon, chief operating officer of EBS; F. Scott Yeager and Rex Shelby, EBS executives; Ben Glisan, Enron treasurer; Dan Boyle, vice president; and Fastow, who is married to former CFO Andrew Fastow and was a one-time assistant treasurer of Enron.

By 7:30 a.m., Rice, Hirko, Hannon, Yeager, Glisan and Boyle had surrendered at FBI headquarters on East T.C. Jester. "Prosecuting this guy is like prosecuting a piano player in a whorehouse," said Boyle's attorney Bill Rosch on the steps in front of the FBI building.

The indictments were reported on earlier this week. As they were sealed, this is the first indication of who is being charged. Reportedly, Andy Fastow is being re-charged, presumably so he can be tried in conjunction with some of these guys. These charges are all related to the Enron Broadband Services fraud, which was not yet on the menu the first time Andy was busted.

Sources said Lea Fastow has also been charged or indicted, probably on a tax count and she could be tried separately from her husband. Defense lawyers are expected to criticize the charge as an attempt to strong-arm her husband to turn against his bosses, Jeffrey Skilling and Ken Lay.


The most controversial defendant is likely to be Lea Fastow, 41, a member of the Weingarten family, which founded a supermarket chain that dominated the Houston grocery business for decades before being sold to a competitor in 1980.

Like her husband, Lea Fastow has a degree from Northwestern University's Kellogg School of Management. She worked at Continental Bank in Chicago and joined Enron in 1990. She left in 1997 after rising to assistant treasurer. She also helped Enron acquire a stunning art collection during its heyday.

In charges that drew a guilty plea from Andrew Fastow's former Enron assistant, Michael Kopper, prosecutors pointedly said that Lea Fastow had received $54,000 for administering one of the partnerships. Also, her name is on some of the accounts frozen by court order pending the outcome of the federal inquiry.

Most of that "stunning art collection" is set to be auctioned off soon, in case you're in the market a little something to decorate the living room.

Here's a detailed background piece on Lea Fastow. Ever since Andy was indicted there's been speculation that the feds have pressured him to roll on Skilling and Lay, with the threat of indicting Lea as leverage. We'll see who blinks first, or if the feds really think the case against Lea Fastow is worth pursuing on its own.

Posted by Charles Kuffner on May 01, 2003 to Enronarama | TrackBack


Posted by: B. K. Oxley (binkley) on May 1, 2003 3:28 PM