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Lea Fastow ends prison term
Wife of ex-Enron CFO served less than a year for income tax evasion.
June 6, 2005: 3:16 PM EDT
By Krysten Crawford, CNN/Money staff writer
Lea Fastow with her husband upon release
Lea Fastow with her husband upon release
Lea Fastow said of her 11 months at this Houston prison: “It’s been a tough year...but it was supposed to be tough.
Lea Fastow said of her 11 months at this Houston prison: “It’s been a tough year...but it was supposed to be tough."
Lay is the prime target in the Enron prosecutions. He is scheduled to go to trial in early 2006 and has denied all wrongdoing.
Lay is the prime target in the Enron prosecutions. He is scheduled to go to trial in early 2006 and has denied all wrongdoing.
Andrew Fastow, Enron's former CFO, is expected to be a key government witness against former Enron chairman Kenneth Lay. Fastow is due to serve 10 years in prison under a plea deal.
Andrew Fastow, Enron's former CFO, is expected to be a key government witness against former Enron chairman Kenneth Lay. Fastow is due to serve 10 years in prison under a plea deal.

NEW YORK (CNN/Money) - Lea Fastow, a former Enron employee and wife of the fallen energy giant's chief financial officer, walked out of prison early Monday after serving nearly 11 months for tax evasion.

Fastow exited a federal lockup in Houston early Monday and was taken to a halfway house, where she will serve the remainder of her sentence, her lawyer confirmed. She is due to be released July 10.

"Lea is a strong woman and is doing well," her lawyer, Mike DeGuerin, told CNN/Money. "She has received no special treatment and continues to not ask for special treatment."

Fastow's release ends one chapter for the Fastows and their role in the downfall of Enron, but another is about to begin.

Andrew Fastow is scheduled to serve a 10-year sentence as part of a plea deal the husband-and-wife team brokered with prosecutors. The Fastows struck a deal that allowed one to serve prison time while the other was free to care for their two children.

Landing Andrew Fastow as a cooperating witness was seen as a major coup for Enron prosecutors. In July 2004, two months after the Fastows cut their deal, the Justice Department filed criminal charges against former Enron chairman Kenneth Lay.

Three and a half years after Enron imploded, government efforts to hold former executives and company advisers accountable show no signs of slowing down.

Eyes are on Lay

According to a Justice Department spokesman, there are 11 pending indictments and 20 convictions, including both guilty pleas and verdicts, in the Enron scandal.

Before last week there were 21 convictions. Prosecutors lost a conviction last Tuesday when the Supreme Court overturned a 2002 guilty verdict that brought down Enron's former auditor, Arthur Andersen.

The high court decision was seen as a major defeat for prosecutors, who had accused the former Big Five accounting firm of obstructing justice when it engaged in massive document shredding as Enron was collapsing in the fall of 2001.

Prosecutors now have the option of retrying Arthur Andersen, which essentially shut down as a result of the verdict. Legal experts said last week that a retrial is unlikely.

Instead, prosecutors are likely to concentrate on their case against Lay, who is due to go to trial early next year along two other former top executives.

Prosecutors are banking on Fastow's testimony to help win guilty verdicts against Lay, ex-CEO Jeffrey Skilling and former chief accounting officer Richard Causey. All have pleaded innocent.

Fastow's cooperation did not come easily. Throughout early 2004 Andrew and Lea Fastow, a former Enron assistant treasurer who was originally charged with multiple felony counts, haggled with prosecutors over terms of a plea deal and the couple's determination to have one parent at home to care for their two sons.

A federal judge in Texas scuttled an initial deal 14 months ago under which Lea Fastow would have served five months in prison, calling the agreement too lenient. Under federal sentencing guidelines, Lea Fastow faced 10 to 16 months in prison.

A month later, the judge approved a second deal that called for Lea Fastow to plead guilty to a misdemeanor charge of tax evasion and serve a year behind bars. Fastow entered Federal prison in Houston last July.

As she left the prison Monday, Fastow described her 11 months behind bars as "tough," her lawyer, DeGuerin, told CNN/Money in an e-mail. According to DeGuerin, Fastow then added that "it was supposed to be tough."

DeGuerin said Fastow was looking forward to being back with her family and "being able to put this behind her."

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