Ken Lay Bank Fraud Trial Will Follow Enron Trial
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.
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