SAN FRANCISCO -- A former top Enron Corp. executive pleaded guilty Thursday to a federal conspiracy charge for rigging California's electricity markets during the power crisis, giving the state powerful ammunition in its claim for $9 billion in refunds from energy companies.
Timothy Belden, 35, Enron's chief energy trader in the West and a corporate vice president, became the first person convicted of a crime in connection with California's 2000-01 energy crisis. He also agreed to cooperate with investigators in a widening probe that could lead to charges against executives at Enron and other companies.
The guilty plea -- which also requires Belden to forfeit $2.1 million in "criminally derived" compensation from Enron -- was vindication for California Gov. Gray Davis and other state officials who have alleged criminality was at the root of the crisis. Last year, Vice President Dick Cheney suggested California was to blame.
"These charges answer the question that has long troubled California consumers: whether the energy crisis was spurred in part by criminal activity," said Kevin Ryan, U.S. attorney for Northern California. "The answer is a resounding yes."
The investigation is being led from Ryan's San Francisco office, but in an indication of its importance, the plea agreement was announced at the Justice Department's headquarters in Washington.
In a scripted proceeding before U.S. District Judge Martin Jenkins in San Francisco, the slight and balding Belden stood flanked by his two attorneys and repeatedly acknowledged his role in schemes with colorful names such as Fat Boy and Get Shorty.
Belden agreed to plead guilty to a single count of conspiracy to commit wire fraud arising from various Enron strategies for manipulating California markets. He hesitated only when Jenkins asked him why he had committed the crime.
"Why did I do it?" Belden repeated. "I did it because I was trying to maximize profit for Enron."
Exactly how much money Enron made from the schemes was not clear, although Deputy Atty. Gen. Larry Thompson said the revenues brought in by Belden increased sixteenfold over a three-year span ending in 2001.
"During the period of the ... conspiracy, Enron's revenues from Belden's trading unit rose from $50 million in 1999, to $500 million in 2000, to $800 million in 2001," Thompson said. "A portion of these increased revenues was due to the execution of these schemes." He would not comment on what that amount might be.
