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Ken Lay Bank Fraud Trial Will Follow Enron Trial

By Jeralyn, Section Crime in the News
Posted on Thu Apr 21, 2005 at 09:15:55 PM EST
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Ken Lay won a round of sorts today when U.S. Disrict Court Judge Sim Lake agreed to postpone his bank fraud trial until the end of his Enron trial.

Initially, Lay moved for a severance from codefendants Jeff Skilling and Rick Causey, saying he wanted a speedier trial. The Judge denied the request for severance of the Enron charges but severed his bank fraud charges.

The Prosecution, trying to take him up on his speedy trial offer, asked the judge to set the bank fraud charges this summer. Lay then moved for a delay until after the Enron trial. He had already offered to waive the jury and have the Judge decide the bank fraud charges. The Court liked the idea but the Government wouldn't commit to waiving the jury (Jury waivers must be agreed upon by both parties.) Shortly before today's hearing, the Government agreed to waive the jury.

So here is how it will work: Lay, Skilling and Causey go to trial in January on the Enron case. When the jury begins deliberating, expected to be around July, the Judge will begin hearing evidence in the bank fraud case.

It's a dicey move because the penalties on the bank fraud counts are heavier than those for the Enron charges. Each of the bank fraud counts carry a maximum of 30 years. [Indictment here, pdf]

The indictment accuses Lay of making false promises that he would not use his millions of dollars in loans to buy stock on margin. The allegations are that the banks could have been put at risk because he lied.

Lay's going to be one unhappy camper if he acquitted by the jury on the Enron charges and then convicted of bank fraud by the Judge.

Mike Ramsey, Lay's lawyer, sounds like he's already playing up to the Judge:

"There has obviously been a lot of gamesmanship by the (Enron) task force and by myself. But now we have the most favorable fact finder we could ask for on both cases."

The documentary, Enron: The Smartest Guys in the Room opens everywhere this week. My review of the film is here.

Ken Lay has a website with legal filings, information about his formidable legal team and news articles. I liked this article, in which he is interviewed about his 3 hours in the federal lockup where he chatted with some of the defendants on trial for murder in the infamous human smuggling case.

One young man said: `I think I saw you on TV last night,' " recalled Lay, who had surrendered that day and was awaiting a court hearing so he could be freed on bond. So for the next three hours, the former CEO and two alleged human smugglers talked. Defendants from other holding cells soon chimed in.

"A couple even asked me for investment advice," Lay said with a laugh. His response: "Well, I've not really thought much about that recently," said Lay, who lost hundreds of millions of dollars after Enron's collapse.

< Leaving Death Row | Juror Lies, Murder Conviction Tossed >

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    Ken Lay Bank Fraud Trial Will Follow Enron Trial | 10 comments (10 topical)
    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#1)
    by Talkleft Visitor on Fri Apr 22, 2005 at 03:53:28 AM EST
    So, Lay talks to other inmates! Will we soon be hearing that Lay gets a reduced sentence in return for testifying about various jailhouse confessions?

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#2)
    by Talkleft Visitor on Fri Apr 22, 2005 at 06:08:56 AM EST
    he has money and he could care less about the rest of what is going to happen. He will ply his lawyers with plenty of the stuff and will walk away a free man. He will still be rich, too! "It is no shame to be poor, to be ashamed of it is." -- Benjamin Franklin These days, though, it is a shame to be rich.

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#3)
    by Talkleft Visitor on Fri Apr 22, 2005 at 06:56:05 AM EST
    no shame in being rich by honest means; how the riches are being acquired (embezzlement/fraud/theft) is a shame.

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#4)
    by kdog on Fri Apr 22, 2005 at 07:12:26 AM EST
    Greed is the shame as well. I mean really, how many houses does one guy need?

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#5)
    by Che's Lounge on Fri Apr 22, 2005 at 07:33:16 AM EST
    Worst case scenario: Bush will Pardon him at the end of his term. The sheeple will have forgotten about him by then.

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#6)
    by Rich on Fri Apr 22, 2005 at 08:12:44 AM EST
    I tend to agree that Kenny Boy will wind up with a pardon, if convicted. It will be hailed as Dear Leader's equivalent of Marc Rich. The administration has constantly tried to distance itself from Lay & Co., so I would hope that there is motivation to bring a strong case.

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#7)
    by kdog on Fri Apr 22, 2005 at 08:20:28 AM EST
    I too fear the presidential pardon is inevitable. I'd say odds of 1/5.

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#8)
    by Talkleft Visitor on Fri Apr 22, 2005 at 08:55:22 AM EST
    If this is not a joke i don't know what is?

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#9)
    by Dadler on Fri Apr 22, 2005 at 10:35:19 AM EST
    lay is toast. he will get the ebbers treatment. it's a done deal. this is a defense attorney's site, and i love and support it, but no defense lawyer will get lay off. unless they manage to find a jury of wealthy friends of kenny boy. now, it could be he was just the world's most incompetent and duped CEO, in which case he should have most of his assets siezed and used to pay out the small shareholders that got reamed. may not be legal, but it's right. the concentration of wealth is a terrible problem in the capitalist world, and it needs to be dealth with harshly. still, i know these are all show trials at heart and make almost no dent in the ongoing daily corruption in our economy, chambers of government, living rooms, etc. we get what we vote for. or don't vote against.

    Re: Ken Lay Bank Fraud Trial Will Follow Enron Tri (none / 0) (#10)
    by Richard Aubrey on Sat Apr 23, 2005 at 07:19:01 AM EST
    There are about a hundred Enron employees who have not been indicted yet but should be. Enron put together a fake trading office with about a hundred workstations all wired up neat-o to impress some visiting investors. The folks sat at the desks barking out orders to buy and sell, or whatever, to each other. Presumably they got paid enough to maintain stratight faces as long as necessary. Now, either one hundred people kept their mouths shut about this fraud, which is or ought to be a crime, or somebody blabbed and the local papers' business editors sat on it. There were a lot of people who were watching their stock shoot up and didn't care how it was done. Their complaint was that they didn't get to sell it to some other poor schmuck before the collapse.

    Ken Lay Bank Fraud Trial Will Follow Enron Trial | 10 comments (10 topical)