Enron’s former chief accountant, Richard Causey, pleaded guilty to securities fraud last week. Causey will probably testify against ex-bosses Kenneth Lay and Jeffrey Skilling. Here’s what the plea could mean for their trial, set to start Jan. 30.
Who is Richard Causey? Although the career accountant had kept a lower profile, Causey was scheduled to go on trial with Lay and Skilling. Like Andrew Fastow, the mastermind of Enron’s shady financing, Causey reported directly to the top two execs. He handled the accounting for the “off–balance sheet partnerships” designed by Fastow that sank the Houston energy firm.
What did he do wrong? Causey pleaded guilty to just one of the 36 counts in his indictment, for using Enron’s financial statements to mislead investors and regulators. Unlike Fastow and some other executives, Causey was never accused of enriching himself at shareholders’ expense. He faces five to 10 years in prison.