More charges filed in Enron case

Wife of CFO, other leaders are indicted

? Former Enron Corp. chief financial officer Andrew Fastow faces 31 more charges and his wife and nine other former executives were indicted Thursday on a host of fraud, insider trading and other counts.

Fastow now faces 109 charges related to the 2001 collapse of the Houston-based energy trading giant, according to new indictments unsealed in Houston. His wife, Lea Fastow, is charged with six counts, including money laundering conspiracy, filing false tax returns and conspiracy to commit wire fraud.

Mrs. Fastow, a former Enron assistant treasurer, walked into the Internal Revenue Service office in Houston early Thursday and surrendered. Her husband dropped her off.

Seven former executives with an Internet division called Enron Broadband Services also were charged in the new indictments. They are accused of orchestrating a scheme to mislead investors through a series of false statements that portrayed the venture as successful.

In fact, prosecutors contend, EBS never generated any revenue and was abandoned by Enron shortly before the company filed for bankruptcy in December 2001.

The indictments allege that five of the former EBS executives sold large amounts of Enron stock while they knew the division was failing, bringing themselves some $186 million in profits. The government is seeking forfeiture of more than $100 million of those profits.

“Today’s indictments are a significant milestone in our determined efforts to expose and punish the vast array of criminal conduct related to the collapse of Enron Corporation,” said Deputy Atty. Gen. Larry Thompson, who heads the Justice Department’s Corporate Fraud Task Force.

The indictments bring to 19 the number of individuals charged in the Enron case, with six of those already entering guilty pleas. Thompson said the probe was far from over.

“The indictments today do not end, by any means, our investigation,” he said.

Lea Fastow, center, leaves the federal courthouse with husband and former Enron Corp. chief financial officer Andrew Fastow, right. Federal prosecutors, broadening their probe into the collapse of energy trading giant Enron, slapped Andrew Fastow with 31 more charges Thursday while indicting his wife and nine other former executives on multiple counts of fraud, insider trading and other charges.

Houston-based Enron was formed in 1985 by a merger of two natural gas pipeline companies. Through the 1990s, Enron transformed itself into a massive energy-trading house that collapsed in 2001 in a whirlwind of revelations of hidden debt, inflated profits and accounting tricks.

The bankruptcy, the second-largest in U.S. history, cost thousands of jobs and wiped out hundreds of millions of dollars in employees’ pension investments.

Those named in the broadband services indictment are former EBS chairman and co-chief executive Kenneth Rice, former president and co-chief executive Joseph Hirko, former chief operating officer Kevin Hannon, and former senior vice presidents Scott Yeager and Rex Shelby. They are charged with securities fraud, wire fraud, and money laundering.

Prosecutors said all those charged Thursday had agreed to turn themselves in and would be released on bond.