Testimony starts in new trial for Wittig, Lake

Former Westar executives accused of committing fraud

? Attorneys for two former Westar Energy Inc. executives repeatedly objected to evidence and testimony presented Wednesday as a prosecution witness began to outline actions the government says amount to white-collar fraud.

The slow movement of testimony from the trial’s first witness – interrupted frequently by defense attorneys who challenged the legitimacy of documents and the line of questioning – foreshadowed what will undoubtedly be a long trial at the federal courthouse here.

It is not the first time David Wittig, Westar’s former chairman and chief executive officer, or Douglas Lake, the former chief strategy officer at the Topeka-based utility, must sit through such intense examination of their actions. An initial federal fraud trial for the two ended December in mistrial after 10 weeks of testimony.

Wednesday’s proceedings included more defense rebuttal to an opening statement by the lead prosecutor, Assistant U.S. Atty. Rich Hathaway, who said the defendants “looked for every opportunity they could find to enrich themselves personally” and broke the law to fund opulent lives.

Edward Little, lead attorney for 55-year-old Lake, said his client did no wrong by earning a big salary and other perks.

“It’s not a matter about greed,” Little said. “It’s about did they earn it, and did they get it legal.”

The first government witness, Overland Park-based attorney Jim Zakoura, has represented some of Westar’s biggest customers in cases against the utility dating back more than two decades. He was questioned about numerous financial reports and other documents he obtained from the company.

He testified that he trolled through logs of more than 1,400 flights on Westar’s corporate airplanes from 1999 to 2002 and discovered that 110 flights included executives’ family members, though he said none was classified as a personal trip.

Defense attorneys said in their opening statements that most of those flights had a business purpose, though they acknowledged some were personal. Still, Little said Tuesday, the executives were not informed such action was wrong.

Zakoura also testified about documents related to a life insurance policy that allowed 49-year-old Wittig to sell death benefits back to the company, one of the bonuses prosecutors claim were not appropriately revealed to shareholders and regulators.

Among other accusations, the 40-count indictment against Wittig and Lake claims the men forced out board members critical of their compensation, manipulated company bylaws to increase their earnings and benefits, and attempted to cash in on a proposed merger – all while Westar’s stock price plummeted and its debt ballooned.