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Dynegy Ex-Exec Gets Stiff Sentence

New federal rules force the judge to order 24 years in prison in a securities fraud case.

March 26, 2004|From Associated Press

HOUSTON — A former Dynegy Inc. executive was sentenced to 24 years in prison Thursday in an accounting fraud case that fell under tough new punishment rules aimed at discouraging corporate corruption.

Jamie Olis is obliged to serve nearly all of his sentence because there is no parole in the federal system. He is 38, and could remain behind bars until he is 62.

"I take no pleasure in sentencing you to 292 months," U.S. District Judge Sim Lake said in handing down the sentence. "Sometimes good people commit bad acts, and that's what happened in this case."

The punishment "reflects Congress' intent that white-collar corporate fraud defendants receive harsh sentences," Lake observed from the bench.

The sentence easily surpassed those of some much more prominent fraud cases, and dwarfed those of some Enron Corp. executives who have pleaded guilty in that company's accounting scandal. Olis, Dynegy's former vice president of fiance, took the chance of a trial and was convicted.

The government maintained that Olis' actions in illegally disguising company debt in 2001 eventually resulted in more than $500 million in stock losses.

The maximum possible sentence was 35 years for one count each of conspiracy, securities fraud, mail fraud and three counts of wire fraud.

The courtroom was packed with Olis supporters, including his wife and infant daughter. Many, including Olis himself, quietly wept after the sentence was pronounced.

Olis' attorneys contended that the government couldn't possibly pinpoint stock losses caused by revelations of a 2001 deal that wrongly boosted cash flow because Dynegy, like other energy merchants, was besieged by months of bad news after Enron's collapse in December 2001.

Olis' sentence is more than double what Andrew S. Fastow, Enron's former chief financial officer, is likely to receive after pleading guilty to two counts of conspiracy in January and agreeing to help prosecutors build other cases. The judge is expected to recommend a 10-year term.

Olis was charged alongside two co-conspirators: his former boss, Gene S. Foster, and a former company accountant, Helen C. Sharkey. They each pleaded guilty to one count of conspiracy. Foster later testified for the prosecution at Olis' trial.

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