Risk & Compliance

Lea Fastow Gets One Year in Prison

Pleads guilty to one misdemeanor count of willfully filing a false tax form.
Stephen TaubMay 7, 2004

Lea Fastow, wife of former Enron Corp. chief financial officer Andrew Fastow, was sentenced to one year in prison and one year of supervision after her release, according to the Houston Chronicle.

In a federal courthouse in Houston, the former Enron assistant treasurer pleaded guilty to one misdemeanor count of willfully filing a false tax form — a joint return for the 2000 tax year that reported more than $48 million in income to the Internal Revenue Service.

“I’ve made errors in judgment I will always regret for the rest of my life,” she reportedly told U.S. District Judge David Hittner. “But I can’t undo the past. I am only able to do what is right now.” She burst into tears after Hittner left the courtroom, according to the Chronicle.

Although she was originally charged with conspiracy to commit wire fraud, money laundering, and four counts of filing a false tax return, the newspaper noted that she was not charged with misdeeds performed while she was working at Enron. She had already quit to stay home with her children, added the paper, when she filed the false tax return about income from an Enron side deal.

The Chronicle, citing several legal experts, said it is very unusual for federal prosecutors to reduce six felony counts to one misdemeanor charge. Lea Fastow’s completed plea deal, continued the newspaper, gives added weight to the argument that she was charged simply to provide leverage against her husband.

Last month, Judge Hittner had rejected an earlier plea deal that would have sentenced her to just five months on a felony tax charge. The Chronicle noted that this may have been a blessing in disguise for Lea Fastow, who plans to obtain a nursing degree; her misdemeanor conviction will not bar her from jobs that ban convicted felons.

She did not immediately go to prison, but instead will report when the Bureau of Prisons decides where she will serve her sentence. Her attorneys asked the judge to recommend that she serve her time at a minimum-security women’s federal prison in Bryan, about 90 miles northwest of Houston, according to the Associated Press.

Under Bureau of Prisons rules, there is no time off for good behavior for any sentence of 12 months or less. However, once Lea Fastow has served 90 percent of her term — or a little more than 10 months — she would be eligible to serve her final five or six weeks in a halfway house or possibly under home confinement, according to the Chronicle.