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Ex-Enron, Merrill workers sentenced

A federal judge on Thursday sentenced former Enron Corp. finance executive Dan Boyle to 3 years and 10 months in prison for his role in a bogus deal with Merrill Lynch & Co. Inc. in 1999 that helped boost the failed energy company’s earnings.
/ Source: Reuters

A federal judge on Thursday sentenced former Enron Corp. finance executive Dan Boyle to 3 years and 10 months in prison for his role in a bogus deal with Merrill Lynch & Co. Inc. in 1999 that helped boost the failed energy company’s earnings.

U.S. District Court Judge Ewing Werlein Jr. also sentenced former Merrill Lynch bankers Robert Furst and William Fuhs to 3 years and 1 month in prison for fraud and conspiracy in the transaction.

A jury convicted Boyle and four former Merrill Lynch employees last year for the deal in which Enron sold electricity-producing barges in Nigeria to the Wall Street bank, but later bought them back at a pre-set price.

Enron recorded the deal as a $12 million profit, enabling it to meet earnings targets for the year, even though it was technically a loan under accounting rules.

Last month, former Merrill employees Daniel Bayly and James Brown received sentences of 2-1/2 years and 3 years 10 months, respectively, for their roles in the deal.

Judge Werlein gave Boyle the minimum sentence allowable under federal sentencing guidelines, and said it was clear from the evidence presented during the trial last year that more senior Enron executives, including former Chief Financial Officer Andrew Fastow and former Chief Accounting Officer Richard Causey, were responsible for the fraud.

“This is a difficult sentencing indeed, Mr. Boyle,” Judge Werlein said during the hearing.

In a short statement to the court, Boyle apologized for his role in the crimes.

“I am the only one responsible for my acts and omissions ... I’m truly sorry,” he said.

Fastow, the architect behind Enron’s off-balance sheet deals that hid billions of dollars in debt, struck a plea agreement with prosecutors last year that is expected to send him to prison for 10 years.

He is expected to testify against Causey, former Enron Chairman Ken Lay and former Enron Chief Executive Jeffrey Skilling when their trial begins in January 2006.

Judge Werlein said despite the intent by the five convicted men to manipulate Enron’s earnings with the bogus barge deal, senior Enron executives engaged in far more serious financial crimes.

The Nigerian barge deal “appears to be one of the smaller and more inconsequential frauds committed by those conspirators,” Judge Werlein told Furst when sentencing him on Thursday morning.