Closing in on Enron crooks
The federal government appears to be going after the crooks who ran Enron and doing so with gusto, seeking to confiscate their assets and, eventually, put them in jail.
Progress toward that end was made last week when Michael Kopper became the first former Enron executive to plead guilty to crimes related to the company's collapse. Kopper admitted his role in creating partnerships that enriched himself and other Enron honchos at the expense of the company and its shareholders.
Kopper faces as many as 15 years in a federal penitentiary, but sentencing has been delayed until next April. That may seem like a long time to wait, but it indicates that Kopper has shown a willingness to help federal investigators nail his former partners in crime.
Enron was an incredibly complex and far-reaching scam involving more than 1,000 splinter companies, and it will not be unraveled without help from the inside. As the aide to former Enron chief financial officer Andrew Fastow, Kopper has the kind of information that federal prosecutors need.
The art of the deal
Kopper admitted to money laundering and conspiracy to commit wire fraud in three partnership schemes. Friends, relatives and favored emplyees were fronts, investing money provided by Fastow or Kopper, so the partnerships appeared independent.
The partnerships then did deals with Enron that generated millions of dollars. Kopper kept some profits and massive fees for handling the deals. He also said he funneled money back to Fastow and his family, as well as the sham investors.
This wasn't clever business, this was theft, pure and simple -- but on an audacious scale.
The brazen nature of the Enron crooks is evident even now, as Fastow continues construction of a $2 million, 12,000-square-foot Houston home. It is made of stone, not unlike some of the nation's finest penitentiaries. If Fastow yearns to live in a big stone house, he should get his wish. There's one in Leavenworth, Kansas, that would be ideal.
In the meantime, a federal magistrate froze Fastow's assets last week after his brother tried to move millions of dollars out of a brokerage account. The tens of thousands of investors and employees who lost hundreds of millions of dollars in the Enron scam will never get more than a fraction of their money back. But the government should do everything within its power to confiscate the ill-gotten gains of the top crooks and to send them to jail.