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Fastow claims may hit Enron case
Paper reports that statements by ex-CFO Fastow in an unsealed affidavit could harm his credibility.
December 8, 2005: 8:13 AM EST
An affidavit given by ex-Enron CFO Andrew Fastow, the star wtiness in the case against other ex-executives of the bankrupt energy trader, could be used against him in that case, according to a published report.
An affidavit given by ex-Enron CFO Andrew Fastow, the star wtiness in the case against other ex-executives of the bankrupt energy trader, could be used against him in that case, according to a published report.

NEW YORK (CNNMoney.com) - Recently unsealed statements made by star prosecution witness Andrew Fastow, the former Enron chief financial officer, could hurt his effectiveness when he testifies against other former top executives of the company early next year, according to a published report.

The Houston Chronicle reports that in an affidavit Fastow gave when he and his wife Lea were fighting tax charges in 2003, he insisted he was not part of a tax charge conspiracy with his wife. Further, he asserted that his wife honestly believed they were correctly characterizing payments from side deals as gifts.

Lea Fastow later pleaded guilty in the tax case, while Andrew Fastow pleaded guilty to other charges and agreed to testify against former Enron Chairman Ken Lay, former CEO Jeff Skilling and former accounting chief Rick Causey.

The case against those three is set to go to trial in January, the paper reported, and their attorneys suggested to the paper that the affidavit unsealed could be used to impeach Fastow's credibility.

"I think it'll be very helpful to us," Mike Ramsey, a lawyer for Lay, told the paper. "It's dynamite cross-examination fodder."

The lawyers for the three had sought to have the affidavits from Fastow's earlier case unsealed. They have publicly said they think some of the people who pleaded guilty and agreed to testify against their clients did so because of prosecutorial bullying, the paper reported. The affidavit and Lea Fastow's subsequent guilty plea might open the door to tough questioning on that point, according to the paper.

Kent Schaffer, a Houston defense attorney who watches the Enron cases, told the Chronicle these affidavits wound Fastow as a witness, but not mortally.

Schaffer said it could come down to Fastow "either making the government case look bad or admitting something wasn't true" because Lea Fastow later said she did falsely report income on their taxes.

"I don't see it as a huge boost to the defense, though," Schaffer told the paper.

Prosecutors would not comment on the unsealed affidavits, and other defense attorneys either would not comment or could not be reached late Wednesday, the paper reported.

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