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Archive for Friday, November 5, 2004

Westar employee: Execs used plane for own benefit

November 5, 2004

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— Former Westar Energy Inc. executive Douglas T. Lake traveled so much that company airplanes were referred to as "The Florida Shuttle," an employee testified Thursday.

Paula Cox, a supply chain analyst at Westar and a former flight coordinator for company aircraft, testified that Lake and his wife often flew to Florida and that Lake and David Wittig, former chief executive officer of Westar, often flew with family members to White Plains, N.Y.

Wittig and Lake, a former executive vice president at Westar, are charged with "looting" the Topeka-bsaed company, the largest electric utility in Kansas. Each faces 40 counts and a minimum of 10 years in prison if convicted.

As part of the federal fraud trial, the government alleges Wittig and Lake used corporate aircraft for their personal benefit.

The government believes that Lake used company planes as a shuttle to and from his primary residence in New York and his vacation home in West Palm Beach, Fla.

Earlier Thursday, David L. Schneweis, director of taxation for Westar, testified that the company did not properly account for personal use of its aircraft.

Schneweis said the company did not assign income to employees for their personal travel and the travel of their family members aboard Westar planes. Instead, the company accounted for the personal use by not deducting the expense from taxes on its corporate aircraft.

Ed Little, an attorney for Lake, noted on his cross examination of Schneweis that the practice of not assigning income to employees for personal travel occurred before Wittig and Lake arrived at Westar and continued after the two had left.

The trial began Oct. 19 and is expected to last 10 weeks.

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