An Enron Trial With Big Stakes for Ones Ahead

[seemslikeadream]

Published September 20. 2004 7:30AM

New York Times


As the first criminal trial stemming from the financial deals at Enron opens in Houston today, it will be notable as much for who is not among the six defendants as who is - and for how little money was involved compared with how much in other Enron-related cases.



Not a single former senior officer of the company will be among the six defendants. Instead, four former senior and midlevel executives with Merrill Lynch, along with two lower-level Enron executives, will be at the defendants' table, facing fraud and conspiracy charges stemming from a single, modest 1999 transaction that increased Enron's earnings by just $12 million.



But the implications in this trial are far-reaching. The accusations - that the executives conspired to structure a bogus sale of an interest in Nigerian electricity-producing barges owned by Enron - reflect similar charges that have been brought in virtually every Enron indictment to date. So both the government and the former senior executives still awaiting trial have an enormous stake in the trial's outcome.



The transaction took place in the last days of December 1999, when Enron was struggling to sell the investment in the barges in time to be included in the quarter's profit figures. Merrill agreed to invest $7 million in an entity that made the purchase, based on an assurance that it would get back its investment, plus a profit, in six months.

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