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Archive for Wednesday, April 10, 2002

Fired Andersen auditor pleads guilty

April 10, 2002

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— The Arthur Andersen auditor who oversaw Enron's books pleaded guilty Tuesday to ordering the shredding of Enron documents and agreed to cooperate with prosecutors.

Former partner David B. Duncan pleaded guilty to obstruction of justice, admitting he tried to thwart an Enron investigation by the Securities and Exchange Commission.

He is believed to be the first person in the Enron case to strike a deal with federal prosecutors.

"Documents were in fact destroyed so that they would not be available to the SEC," he told U.S. District Judge Melinda Harmon, reading from a statement.

The charge carries up to 10 years in prison and hundreds of thousands of dollars in fines. Attorneys did not release details of any agreement on the sentence. Duncan remains free until his sentencing on Aug. 26.

Duncan was fired by Andersen after the accounting firm acknowledged the large-scale destruction of documents and deletion of computer files related to the collapse of the energy giant, whose bankruptcy cost thousands of employees their jobs and, in many cases, their life savings.

Under the plea bargain, Duncan is immune to further prosecution related to the Enron case as long as he fully cooperates with federal authorities and agrees not to sell his story or otherwise profit from the debacle.

In court, Duncan described how he ordered Andersen employees on Oct. 21 to destroy certain documents two days after he learned that the SEC was investigating Enron.

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