Former Westar CEO sentenced to 18 years for looting utility

TOPEKA, KANSAS - A federal judge sentenced former Westar Energy Inc. CEO David Wittig to 18 years in prison for looting millions from the Kansas utility.

U.S. District Judge Julie Robinson sentenced Wittig's co-defendant, Douglas Lake, the former executive vice president of Westar, to 15 years in prison. Wittig and Lake also were ordered to pay fines of $5 million each, in addition to millions of dollars in restitution.

Attorneys for both men said they intend to appeal.

The sentences brought to a close legal proceedings that began shortly after Wittig, Westar's former president, chairman and chief executive, and Lake left the company in late 2002 amid concerns that they had used a barrage of schemes to inflate their pay and benefits and hide them from the company's board of directors and shareholders.

An initial three-month trial ended in a hung jury in late 2004, but jurors in a second trial on Sept. 12 found the two men guilty of conspiracy, wire fraud, money laundering and circumventing internal controls during their tenures at Topeka-based Westar, the largest electric utility in Kansas.

Wittig, 50, was convicted of 39 counts; Lake, 55, was convicted of 30 counts and acquitted of nine.

During sentencing, Robinson drew parallels to the Enron scandal, but said she thought Wittig and Lake's behavior may have been worse.

"The defendants' greed was unbridled and seemingly limitless," she said. "The defendants weren't trying to keep an unhealthy company afloat. They were trying to destroy a healthy company and for what reason? Their own compensation."

Robinson refused bond for both men pending appeal, saying she didn't think defense attorneys had raised strong arguments for overturning their convictions. She also said the men had shown "disrespect" for the court by not adequately informing prosecutors and federal probation officers about their finances.

Wittig has been in federal prison in Leavenworth since January when Robinson revoked his bond for violating terms of his release on an earlier, separate bank fraud conviction. He is to be sentenced on that conviction April 24.

The former Wall Street whiz kid attended the hearing in an orange prison jump suit and ankle shackles and could only wave to his wife and friends in the gallery.

Robinson did agree to let Lake voluntarily surrender to authorities within the next 60 days, giving him time to attend his son's wedding later this month.

The U.S. Probation Office had recommended life in prison for both men, but attorneys for both defendants argued their clients' crimes were not serious enough to warrant that sentence.

"The government cannot or will not acknowledge that David did a single good thing at Westar or in his entire life," said Paula Junghans, one of Wittig's attorneys. "We ask that you punish David, not destroy him."

Lisa Cahill, representing Lake, pointed out that as opposed to Enron, Adelphia and other companies rocked by corporate mischief, Westar was still operating.

U.S. Attorney Eric Melgren later scoffed at that defense: "No thanks to these defendants."

Also Monday, Robinson ordered Wittig to pay $14.5 million in restitution and Lake to pay $2.785 million.

However, a jury already had ordered the former executives to forfeit some of that money, as well as other cash and assets, which jurors had determined were linked to the defendants' crimes.