Enron Ex-Director To Be Guilty!

Former Enron executive Michael Kopper will plead guilty to wire fraud and money laundering charges, the first admission of guilt in the federal investigation of the fallen U.S. energy giant.

Kopper, former managing director of Enron Global Finance, will enter pleas Wednesday in Houston to single charges of conspiracy to commit wire fraud and money laundering, sources close to the investigation said Tuesday.

Kopper was a top lieutenant to former chief financial officer Andrew Fastow and became a focus of investigators because of his involvement in Enron-related partnerships. Whether the plea was attached to an agreement to cooperate with investigators was not immediately clear. Kopper had not been charged with any wrongdoing, although he had been under investigation. One source said the plea bargain does not guarantee that prosecutors will not seek prison time for Kopper.

Kopper had run a partnership called Chewco, named for the "Star Wars" character Chewbacca, until he left Enron in 2001 to run another Fastow-created entity called LJM2.

An investigation by Enron's board determined Kopper and his domestic partner used Enron partnerships to grow a $125,000 US personal investment into $10.5 million US in less than three years.

Officials with former Enron auditor Arthur Andersen LLP said they learned early last November that Kopper's partner owned part of the three per cent of Chewco that should have been held wholly by investors unrelated to Enron to allow the company under accounting rules to keep the partnership off its books.

Houston-based Enron, which took the investments of millions of people with it when it entered bankruptcy in December, used a web of thousands of off-balance-sheet partnerships to hide $1 billion US in debt from investors and federal regulators.

Government investigators are looking into whether Enron managers, from former chairman Kenneth Lay down, knew that the network of partnerships was being used to conceal huge debts.

Federal regulators have found evidence of price manipulation and deceit by Enron as the energy trader aggressively sought ways to profit from California's volatile power markets. Prices soared in the state in 2000 and early 2001.

The Federal Energy Regulatory Commission has urged further investigation into possible misconduct charges.

Kopper, 37, is a native of Long Island, N.Y., and a 1986 graduate of Duke University. He later attended the London School of Economics and arrived at Enron in 1994.


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