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Ex-Exec at Enron Enters Guilty Plea

Former Treasurer Ben Glisan starts a five-year prison term as part of a deal with prosecutors.

September 11, 2003|Jesus Sanchez | Times Staff Writer

Former Enron Corp. Treasurer Ben Glisan was led away in handcuffs and ankle chains Wednesday to begin serving a five-year prison sentence after pleading guilty to conspiring to commit securities and wire fraud in the financial scandal that brought down the once high-flying energy company.

Glisan, 37, who admitted to conspiring with others to pump up Enron's financial results and hide its mounting problems, is the highest-ranking Enron executive to be convicted and the first to go to prison. Federal authorities took him into custody after he entered his plea before U.S. District Judge Kenneth Hoyt in Houston.

The conviction was a victory for federal prosecutors. But unlike some other former Enron employees who have pleaded guilty, Glisan did not agree to cooperate in the case against other top executives, such as his former boss, former Chief Financial Officer Andrew S. Fastow.

Glisan originally was charged with two dozen counts of money laundering, fraud and conspiracy for his role in transactions that prosecutors say were devised by Fastow, who has pleaded not guilty and is scheduled to go on trial in April.

In exchange for Glisan's guilty plea to a single count of conspiracy, prosecutors agreed to drop the remaining charges.

Under the deal, Glisan agreed to give up $938,000 in profits he made from an investment partnership related to Enron and to forgo a $412,000 income tax refund. He will also remain under government supervision for three years following his release from prison.

"Mr. Glisan today accepted responsibility for his part in Enron's collapse," acting Assistant U.S. Atty. Gen. Christopher Wray said in a statement. "We fully intend to see to it that all those who have criminal responsibility are brought to justice."

Glisan played a major role in creating some of the complicated investment partnerships -- with names such as Talon and Raptor -- that not only masked Enron's financial problems, but also enriched its executives.

Some of the partnerships permitted Houston-based Enron, which is now in federal Bankruptcy Court, to avoid reflecting investment losses on its balance sheet, obscuring them from shareholders and investors.

Glisan admitted that he and others created partnerships to make them appear to comply with accounting rules that in fact were being violated.

The financial failure of some of those partnerships ultimately helped push the company into Chapter 11 bankruptcy protection in December 2001, the government said.

Enron executives who have been convicted include former Enron finance executive Michael J. Kopper, who pleaded guilty to wire fraud and money laundering and is cooperating with the government's investigation.

In addition, former Enron energy traders Timothy N. Belden and Jeffrey Richter pleaded guilty to conspiracy to commit fraud by manipulating energy prices in the California market.

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