Enron trader pleads guilty to manipulating Calif. market
San Francisco ? A former Enron trader accused of masterminding a scheme to drive up energy prices during California’s power crisis pleaded guilty Thursday to conspiracy and agreed to cooperate with prosecutors.
Timothy Belden, the former head of trading in Enron’s Portland, Ore., office, admitted to one count of conspiracy to commit wire fraud. He faces up to five years in prison and must forfeit $2.1 million.
“I did it because I was trying to maximize profit for Enron,” Belden told U.S. District Judge Martin Jenkins.
U.S. Atty. Kevin Ryan said the guilty plea demonstrates once and for all that the rolling blackouts and huge price increases that rocked California last year were the result of illegal conduct.
“These charges answer the question that has long troubled California consumers: whether the energy crisis was spurred in part by criminal activity. The answer is a resounding yes,” Ryan said.
Belden, 35, who now lives in Houston, was released on $500,000 bail. He will be sentenced in April.
Belden’s plea is the first prosecution of anyone in connection with the West’s energy crisis. It is also the first public acknowledgment by the federal government that criminal activity helped drive up power prices a point California Gov. Gray Davis and other lawmakers have been making since the crisis began two years ago.
The case represents a remarkable evolution in the Bush administration’s attitude about the energy crisis. In May 2001, Vice President Dick Cheney said California was to blame for power shortages and soaring prices. “They caused it themselves,” Cheney said.
Belden will help federal prosecutors in their case against higher-ranking officials at Houston-based Enron, the energy giant whose collapse last year has roiled the energy industry, prosecutor Matthew Jacobs said.
Belden’s attorney, Cristina Arguedas, said his client was following Enron’s instructions when he handled his trades and will “make amends for that by cooperating with the government.”
Belden is the third Enron figure to be prosecuted. Andrew Fastow, Enron’s former chief financial officer, is charged with devising the off-the-books partnerships that were used to hide some $1 billion in debt. Fastow aide Michael Kopper pleaded guilty in August to money laundering and conspiracy.