Enron Investors Find An Ally

Attorneys for investors suing investment firms and global banks they claim played key roles in Enron's collapse have a new ally in their efforts: the former Enron chief financial officer Andrew Fastow.

During Fastow's recent sentencing hearing, three attorneys for investors asked the Judge Kenneth Hoyt of U.S. District Court to be lenient with him in part because he was helping investors who lost millions of dollars in the former energy giant's bankruptcy. Fastow has also agreed to give a deposition in their class-action lawsuit, they said.

Hoyt sentenced Fastow to 6 years in prison, less than the 10-year term he had agreed to in his 2004 plea bargain.

G. Paul Howes, an attorney for the University of California, said Fastow had agreed to provide details about the role banks and investment firms played in the company's collapse. The university is the lead plaintiff in securities litigation against Enron and several banks.

In a court filing in the investor lawsuit, Fastow said Merrill Lynch, the U.S. brokerage, along with the banks Credit Suisse, Barclays and Royal Bank of Scotland Group, helped Enron create financial structures that hid the Enron's true financial condition.

"I believe that my work made the company look more healthy and profitable than it actually was," Fastow said in 25- page statement that was part of the court filing. "I worked with certain banks to accomplish this goal, and I viewed certain banks as problem solvers."

Enron, the former energy giant, crumbled into bankruptcy in December 2001 after years of accounting tricks could no longer hide billions in debt.

A spokesmen for Merrill Lynch declined to comment. Credit Suisse, the Royal Bank of Scotland and Barclays could not immediately be reached for comment. The banks have previously denied any wrongdoing.

The former head of Citibank's worldwide commodities trading activity pleaded guilty to conspiracy in a scheme the government says was aimed at inflating trading profit and boosting his bonuses, The Associated Press reported from New York.

David Becker, the former Citibank employee, pleaded guilty in U.S. District Court in Manhattan to conspiracy to falsify bank records and to commit wire fraud. Judge Alvin Hellerstein set sentencing for Jan. 26.