When the FBI Comes Calling…®

July 10, 2006

By KRISTEN HAYS Associated Press

British bankers in Enron case to be extradited

HOUSTON - A trio of British bankers is finally scheduled to appear before a Houston federal judge this week, more than four years after they were charged with pocketing millions of dollars from an alleged Enron Corp. scam.

The three men - Gary Mulgrew, Giles Darby and David Bermingham - were to be extradited Thursday, having lost last month the last of multiple battles to avoid crossing the Atlantic Ocean.

Bermingham told British Broadcasting Corp. radio on Monday that the three would board a Houston-bound plane Thursday morning, escorted by U.S. marshals.

"We believe we are going to be flown direct to Houston and on arrival there we will be issued with our orange boiler suits, our foot chains and our hand chains and, if we are unable to secure bail - which is increasingly likely at the moment - then we are going to go straight to the federal penitentiary," Bermingham told the network.

The men will remain in federal custody pending a Friday appearance before U.S. Magistrate Stephen Smith in Houston, court officials said. Bail has yet to be considered.

The bankers, all British citizens, deny any wrongdoing.

Their case has garnered much attention internationally, sparking a campaign by Britain's business leaders and opposition lawmakers to decry what they say is the misuse of a treaty - not yet ratified by the United States - to ease extradition of terrorists.

But in the United States, the case against the bankers is a remnant of the earliest days of the federal government's sprawling 4 1/2-year probe that led to the May fraud and conspiracy convictions of Enron founder Kenneth Lay and former CEO Jeffrey Skilling.

Lay died last week of heart disease while vacationing in Aspen, Colo. His convictions on fraud and conspiracy likely will be erased by his death.

Skilling faces sentencing Oct. 23. He was convicted after the pair's four-month trial of 19 counts of fraud, conspiracy, insider trading and lying to auditors and faces decades in prison. He aims to appeal.

Jurors determined both repeatedly lied to investors and employees about Enron's financial health before the company crumbled into bankruptcy proceedings in December 2001 amid one of the biggest corporate scandals in U.S. history.

Neither Skilling nor Lay knew about the financial scam that prosecutors say involved the British bankers, according to trial testimony.

The bankers each face seven counts of wire fraud for allegedly colluding with former Enron Chief Financial Officer Andrew Fastow and his former top aide, Michael Kopper, in a series of transactions. Prosecutors say the scheme defrauded both Enron and Greenwich NatWest, a unit of the bankers' then-employer, National Westminster Bank PLC. Greenwich NatWest is now a unit of Royal Bank of Scotland Group PLC.

The government contends the bankers siphoned $7.3 million, while Fastow, Kopper and others skimmed $12.3 million from the scheme.

The bankers were initially charged in June 2002. Kopper pleaded guilty to two counts of conspiracy two months later.

Fastow pleaded guilty in January 2004 to two counts of conspiracy for masterminding other fraudulent deals at Enron.

If the bankers go to trial, Fastow and Kopper could be among government witnesses to testify against them.

The bankers each face a maximum of 35 years in prison.

Douglas McNabb, a Houston lawyer who testified as an expert witness for the bankers on the U.S. legal system during extradition proceedings, said Monday that the bankers could remain behind bars until they strike a plea deal or go to trial.

"If the government is opposed to bond, then they're not going to get out," McNabb said.

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