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Energy Trader to Admit Fraud

Former high-ranking Enron official is expected to plead guilty to a conspiracy count.

October 17, 2002|From Times Staff and Wire Reports

The head of Enron Corp.'s energy trading operation in the West has reportedly agreed to plead guilty today to a criminal charge for his role in manipulating electricity prices in California.

Law enforcement sources, speaking on condition of anonymity, told Associated Press that Timothy Belden, the former chief of Enron's Portland, Ore., trading office, will plead guilty to a single charge of conspiracy to commit wire fraud.

Neither Belden nor his attorneys, Paul Meltzer of Santa Cruz or Julie Salamon of Emeryville, could be reached for comment late Wednesday. Belden and other traders were said to be trying to reach an agreement with prosecutors in exchange for testimony.

Belden, who allegedly dreamed up some of Enron's trading techniques with names such as Fat Boy and Death Star, would be the third Enron official to face criminal charges.

For The Record
Los Angeles Times Friday October 18, 2002 Home Edition Main News Part A Page 2 National Desk 8 inches; 311 words Type of Material: Correction
Enron bonus -- A story in the California section Thursday incorrectly listed the amount of the retention bonus for former Enron energy trader Timothy N. Belden. Belden's bonus was $5.5 million, not $5.5 billion.

Andrew S. Fastow, Enron's former chief financial officer, was charged Oct. 2 with fraud, money laundering and conspiracy in connection with the vast web of off-the-books partnerships used to hide Enron's debt. In August, Fastow aide Michael Kopper pleaded guilty to money laundering and conspiracy to commit wire fraud.

"We have long suspected that Tim Belden was the mastermind of the strategies described in the Enron memos," said Chris Schreiber, chief investigator with the state Senate select committee to investigate manipulation of California's electricity market, referring to internal Enron documents released by federal regulators in May. "That's been our suspicion even before the Enron memos even broke on the radar screen."

"We knew that much of the manipulation in the market had to be taking place by the traders and given that," Schreiber said, "we knew Enron was a big player here."

"Once the memos broke it confirmed our suspicions that Tim Belden was one of the big players. Of course the documents we've uncovered since confirmed that he was the mastermind."

Schreiber said he believes prosecutors are hoping Belden helps them convict top Enron executives. "I think they're going to try to use Belden to get back to Houston," said Schreiber, "and by Houston I mean Jeff Skilling and Ken Lay."

Belden had moved to Houston to work for UBS Warburg, which bought Enron's trading operations in January. But Belden, who got a $5.5-billion retention bonus shortly before Enron filed for bankruptcy-court protection, left UBS on Oct. 1 to return to Portland.

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Times staff writers Nancy Vogel and Nancy Rivera Brooks contributed to this report.

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