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A former executive who had questioned the LJM partnerships took the stand Tuesday at the trial of Kenneth Lay and Jeffrey Skilling.

Vince Kaminski, who was in charge of Enron’s risk management team, testified that when he learned about the proposal to create LJM in June 1999, he told superiors that it was a conflict of interest for Andrew Fastow to run the partnership while serving as chief financial officer of Enron, according to the Houston Chronicle. Kaminski also reportedly warned that LJM was potentially unstable because it was financed largely by Enron’s stock and that the deal was structured so benefits would not flow to Enron.

Kaminski said that he voiced these concerns to his boss, Rick Buy, then the executive vice president and chief risk officer, the Chronicle continued. Although Buy shared those concerns with upper management, Kaminski continued, he did not stop LJM’s first transaction. “My understanding is that this was highly controversial,” Kaminski reportedly recalled, “and that there was a lot of pressure to go forward with this transaction.”

A few days later, Kaminski reportedly testified, he received a call from Skilling, who said that Kaminski and his group were acting like “cops” instead of helping push through transactions. According to the Chronicle, Kaminski was later transferred.

Earlier in the day, a relatively junior employee supported Fastow’s claims that Skilling knew the secret LJM partnerships were used to manipulate the company’s financial statements, according to The Wall Street Journal.

Christopher Loehr, who joined Enron in 1999 while in his mid-20s, reportedly testified that Fastow told him “at least a dozen times” that Enron had promised LJM wouldn’t lose money on the transactions. Loehr “understood that it was a senior executive” who was behind the promise, but he also testified that Fastow never said Skilling specifically made the alleged guarantee, the Journal reported.

Loehr also testified that at Enron, backdating documents was common enough that it had a nickname of its own: “time travel.”

On cross-examination, Skilling attorney Daniel Petrocelli went out of his way to point out that Loehr was a low-level employee who was not in a position to know how the deals were negotiated. (Loehr, it should also be noted, is one of the few prosecution witnesses not under indictment, the Chronicle noted.)

Prosecutors also called to the witness stand a former Enron employee who lost his retirement savings by investing in Enron stock, allegedly due to upbeat statements made by Lay, according to the Chronicle.

“In early 2000, the stock was going up and all the guys at work were telling me what an idiot I was for diversifying, so I rolled it all up in Enron stock,” said Johnnie Nelson, a longtime field worker from Enron’s pipeline division. “I lost everything.”

Nelson, who worked in New Mexico, was bussed to Liberal, Kansas, to hear Lay deliver a speech to employees. “When he first came to Liberal and told us what his visions were going to be, we all believed them because they all came true,” he reportedly testified. Nelson added that he and other workers also believed Lay in October 2001 when the CEO tried to allay their concerns in the wake of an SEC investigation into Enron and Fastow’s LJM partnerships, the Chronicle noted.

On cross-examination, Lay attorney George “Mac” Secrest reportedly asked Nelson what a chief executive does, and whether a CEO would typically rely on information from subordinates. A continuing theme of the defense is that Lay and Skilling were unaware of many activities taking place around them.

“He violated my trust,” Nelson reportedly replied. “That’s all I know.” Nelson — who did not back down under Secrest’s repeated questions, the Chronicle observed — stated at one point that “we’re not talking about stamps and stationery. These were millions and millions of dollars.”

During a scheduling discussion with Judge Sim Lake toward the end of the day, Enron Task Force chief Sean Berkowitz stated that prosecutor should rest their case during week of the March 27. Another Enron whistle-blower, Sherron Watkins, is expected to take the stand on Wednesday, according to the Chronicle.

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