Risk & Compliance

Enron Broadband Retrial Divvied Up

Prosecutors will reportedly seek new indictments for five individuals, including two former finance executives who face a separate trial.
Stephen TaubSeptember 12, 2005

Five former executives of Enron Broadband Services, whose case ended largely in a mistrial earlier this summer, will face a retrial next year — but not as a group.

Lisa Monaco, a prosecutor for the Enron Task Force, said that the government would seek new indictments shortly for the five individuals, according to the Houston Chronicle. U.S. District Judge Vanessa Gilmore, who presided over the original, three-month-long trial, scheduled court dates beginning in May 2006 for three separate trials.

The five individuals who worked at the unit of Enron Corp. had been accused of inflating the value of the division, either by lying about its technological prowess or by faking a sale to boost earnings and inflate its share price, reported the Chronicle.

In July, former EBS chief executive officer Joe Hirko was acquitted of insider trading and money laundering charges; former senior vice president of strategic development F. Scott Yeager was acquitted of fraud and conspiracy charges; and former senior vice president of engineering operations Rex Shelby was acquitted of insider trading charges, according to reports.

The jury deadlocked on all charges against former vice president of finance Kevin Howard and former senior director of transactional accounting Michael Krautz. Their case will be heard first, according to the paper.

The following month, Yeager will be tried on his remaining insider trading and money laundering charges; in September, Hirko and Shelby will be retried on conspiracy and fraud charges.

Earlier this year, the Enron Broadband case had been widely viewed as a harbinger of next year’s showcase trial of former Enron chairman Kenneth Lay, former chief executive officer Jeffrey Skilling, and former chief accounting officer Richard Causey. That trial is still scheduled to begin in January; all three have pleaded not guilty.

4 Powerful Communication Strategies for Your Next Board Meeting