Enron's Causey is given 5 1/2 years

Ex-accounting officer pleaded guilty in Dec.

November 16, 2006|By Houston Chronicle

HOUSTON -- Richard Causey, Enron Corp.'s former top accountant whose affable nature earned him the nickname of "Pillsbury Doughboy" at a company known for its ruthless culture, will serve 5 1/2 years in prison for his role in perpetuating its sprawling fraud.

"There were improper things done at Enron. Some of those things were done by me, and for that I am profoundly sorry," a visibly nervous Causey told U.S. District Judge Simeon Lake before learning his punishment.

"However, as God is my witness, I never did anything to enrich myself," Causey said.

He added that he never intended to hurt anyone at Enron, and that he had heard many stories about how employees and shareholders were devastated financially when the company crashed into bankruptcy nearly five years ago.

"Those stories broke my heart," he said.

Lake shaved 18 months from the seven-year term Causey agreed to serve upon pleading guilty to securities fraud last December.

Lake also ordered Causey to pay a $25,000 fine, in addition to the $1.25 million he agreed to forfeit when he pleaded guilty. The cash eventually will be distributed to Enron shareholders who lost money when the company went bankrupt.

Then the judge wished him well and allowed him to remain free until the U.S. Bureau of Prisons notifies him of a date to surrender - a process that generally takes six to eight weeks.

"I know you face a difficult number of years ahead," Lake said, noting that Causey should emerge from prison a better man with the support of family and friends. "I wish you good luck."

Causey's prison term is the third-harshest imposed on Enron executives who either pleaded guilty to crimes or lost the gamble of going to trial. He also is the last of Enron's most senior executives to learn his punishment.

His sentence is far more lenient than the 24-year, four-month term awaiting his onetime boss, former Enron chief executive Jeffrey K. Skilling, who was convicted of 19 criminal counts by a jury last May. Lake sentenced Skilling last month. Skilling is to surrender Dec. 12 to a federal prison in Waseca, Minn.

Causey was bound for trial alongside Skilling and former Enron Chairman Kenneth L. Lay until he broke from their unified defense and pleaded guilty just weeks before the case began in late January.

Causey had faced more than 30 criminal counts largely similar to those against Skilling that accused him of being a principal architect in concocting fraud by approving misleading financial statements and lying to investors about Enron's health. Had he gone to trial and been convicted, he would have faced a sentence comparable to Skilling's.

Lay also was convicted and also faced a double-digit sentence, but he died of heart disease in July. Lake erased Lay's convictions because he died before sentencing and appeal.

Causey's term also is a few months shorter than the six-year sentence imposed by another judge on former Enron finance chief Andrew S. Fastow, who admitted to concocting schemes to manipulate Enron's books while skimming millions of dollars for himself on the side. Fastow, sentenced in late September, went into custody and is at a federal prison in Louisiana.

Defense attorney Reid Weingarten argued yesterday that Causey committed fewer crimes than Fastow and didn't skim money from schemes, so he should serve less time than the ex-CFO. Fastow agreed upon pleading guilty in January 2004 to serve 10 years in prison, but another judge shaved that term.

Kathryn Ruemmler, one of the lead prosecutors in the Lay-Skilling case, countered that Lake needed to focus on Causey's behavior. "As chief accounting officer, Mr. Causey bore tremendous responsibility to Enron employees and investors. And he abdicated that responsibility," she said.

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