Risk & Compliance

Lea Fastow Leaves Prison

Although she was originally charged with conspiracy to commit wire fraud, money laundering, and four counts of filing a false tax return, she event...
Stephen Taub and Dave CookJune 6, 2005

Lea Fastow has left prison after serving nearly 11 months for filing a false tax return, according to published reports.

Wearing a white polo shirt and jeans, the former Enron Corp. assistant treasurer looked healthy when she emerged at 4 a.m. from the Federal Detention Center in downtown Houston, reported the Houston Chronicle.

She was accompanied by her husband — former Enron chief financial officer Andrew Fastow — who has yet to be sentenced for his role in the energy giant’s collapse.

“It’s been a tough year, but it’s supposed to be a tough year,” she said, according to the paper. “I am going home to my family soon. That’s exactly what I’m looking forward to.”

Houston’s Federal Detention Center is considered more restrictive than the minimum security prison camp her attorneys had sought, according to the Chronicle. Lea Fastow will spend the remaining five weeks of her sentence in a halfway house, although the newspaper added that the Bureau of Prisons could have permitted her to serve the rest of her sentence under home confinement.

Fastow 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.

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; her plea deal, continued the newspaper, gives added weight to the argument that she was charged simply to provide leverage against her husband.

Andrew Fastow is expected to be a key prosecution witness in the fraud and conspiracy case against former Enron chairman Kenneth Lay, former Enron chief executive officer Jeffrey Skilling, and former Enron chief accounting officer Richard Causey. That trial is scheduled to begin in January.

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