Enron’s former chief financial officer, Andrew Fastow, and one-time managing director, Michael Kopper, are expected to testify at the trial of the so-called NatWest Three, according to the British-based Guardian..
The three former bankers, David Bermingham, Giles Darby, and Gary Mulgrew, are accused of embezzling $7.3 million in an Enron-related fraud, according to the paper. Last week, the three individuals were flown from London to Texas and are currently out on bail, having spent the weekend at the Houston home of their defense attorney, said the report.
Fastow and Kopper have already pleaded guilty for their role in the former energy giant’s collapse.
“The Enron participants have already pled guilty to the very scheme with which these defendants are charged,” says the prosecution’s memo, according to the paper. “In addition, the Enron participants have given sworn factual statements that describe the defendants’ involvement in the charged scheme.”
Fastow and Kopper are the only prosecution witnesses, wrote the Guardian, citing the defendants’ lawyer in Britain, Mark Spragg. “They both entered a plea and cooperation agreement,” Spragg told the paper. “The cooperation part is that they will dump down on everybody else.”
U.S. prosecutors have charged that the trio convinced their employers to invest in an off-balance-sheet partnership that was controlled by Fastow and Kopper. According to an earlier account in the Financial Times, the British bankers later persuaded Greenwich NatWest to sell its stake in the partnership for $1 million, far less than it was worth. The excess value was $20 million, of which $12 million was shared by Fastow and Kopper, said a report in London’s Daily Telegraph.
Bermingham, Darby, and Mulgrew each face 23 years in prison without parole if they are convicted at their Houston trial, scheduled for September 11, but widely expected to be delayed, according to the Guardian.. The potential sentence is longer than what they would have likely received if the trial was held in a British court, opined the paper.
However, if convicted, the three will probably spend less than 10 years each in prison, noted the Guardian. The prosecution memo stated that based the size of the alleged fraud, “the defendants, if convicted, face a potential sentencing range under the U.S. sentencing guidelines of seven to nine years’ incarceration.”