The Difference Between Ebbers and Lay
You would think Ken Lay's lawyers would be shaking in their Texas boots after yesterday's conviction of Worldcom's Bernard Ebbers. Not so. Lay may have been more hands-off and less involved in the financial aspects of Enron than Ebbers was at WorldCom. His lawyer, Mike Ramsey, says another big difference will be the cooperating co-conspirators: Andrew Fastow is not Scott Sullivan.
"At Enron we had a trusted employee who was stealing and hiding his theft from the people above him," Ramsey said of ex-CFO Andrew Fastow. "But Sullivan at WorldCom appears to be just a cheat, and not a cheat and a thief."
As many credibility problems that Sullivan had, I think Fastow may have even more. He kept denying his and Ken Lay's involvement until the very end--when his wife was either going to have to go to trial or take a deal. The Government said no deal for Lea Fastow unless Andrew pleaded guilty and took a ten year hit. That' not only purchasing Fastow's testimony, it's practically extorting it. How credible is a man going to be whose testimony was obtained by threatening the mother of their two young children with a long prison sentence....or a five month sentence, to be served after he goes in so the children don't spend any time without at least one parent?
Some deals are too good for defendants to turn down. Sometimes juries understand. If the Ken Lay jury doesn't believe Andrew Fastow, Ken Lay should walk.
Plus, Andrew may be a little bitter now. The Judge refused the five month deal between Lea and the Government, and instead sentenced her to one year. Worse, the judge refused to make a recommendation to the Bureau of Prisons that she serve her time at a camp. BOP designated her to a downtown Houston high-rise federal detention building, where she's in a cell with nowhere near the kind of amenities or visiting facilities that Martha had. And don't get me wrong, Martha didn't have many.
So if Andrew's stipulated sentence is 10 years, all he has to do to get it is not mess up at Lay's trial. Demeanor plays a big role in how juries assess credibilty. If Fastow gives the answers, fairly monotonously, but they're correct, and he answers every question, he'll get his 10 years. If he goes gung ho, and answers questions with exhuberance, he'll get no less than ten years. So he can act like a robot and not hurt himself or Lea. And he'll do less damage to Ken Lay, whom he may hate, but he probably hates the Government more for separating his family for so long.
One more factor: Ken Lay will be tried in Texas. He'll have the home boy advantage.
I've written far more here about Lea and Andrew, since Lea's sentence to "hard time" really angered me, but I've also written about Skilling and Enron. There's a search box on the right side of TalkLeft and you can just type in their name and all the posts I've written will come up.
This post is getting long, so I'll put the chronolgy of the events in the next post.
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