HOUSTON—
A judge moved ahead with trial plans for the wife of former Enron finance chief Andrew Fastow after a Friday deadline for her to accept his conditions on a plea deal passed with no word from her attorneys.Without a deal for Lea Fastow, a separate plea agreement for Andrew Fastow seemed unlikely, which could hinder the government's investigation of other executives from the failed energy giant, most notably former top executives Kenneth Lay and Jeffrey Skilling.
U.S. District Judge David Hittner said Thursday he would accept a plea of guilty to a single tax violation from Lea Fastow, a former assistant treasurer at Enron, but balked at being bound to a five-month prison sentence. He reserved the right to determine a sentence he deemed appropriate after federal probation authorities conducted a pre-sentencing investigation.
A conviction on a single federal tax count normally carries a range of 10 months to three years in prison, Hittner said.
Lea Fastow's attorneys were not in federal court Friday and did not immediately return phone calls seeking comment on whether the plea negotiations would continue. John Keker, Andrew Fastow's lead attorney who attended a hearing in Lea Fastow's case on Thursday, had checked out of a downtown Houston hotel by midday Friday.
Attorney Mike DeGeurin has said a the five-month sentence for Lea Fastow was key to both plea negotiations because the Fastows have two young sons, ages 4 and 8, and want to ensure that at least one parent is at home for them.
Hittner gave Lea Fastow until noon Friday to decide whether to accept the plea agreement. After the deadline passed, the judge issued a statement saying Lea Fastow failed to advise the court of her "willingness to receive a plea of guilty" under his conditions, and her trial would go ahead as scheduled Feb. 10.
"We're a little disappointed," said Leslie Caldwell, head of the Justice Department task force investigating the Enron collapse, as she left the courthouse for a Houston airport. She did not elaborate.
Hittner said Lea Fastow's attorneys and prosecutors would be given copies of questionnaires filled out by potential jurors on Friday. They must produce lists of which jurors they want to eliminate by Wednesday.
Andrew Fastow, who prosecutors allege arranged a web of schemes to enrich himself and others while inflating Enron's profits and hiding company debt, was negotiating a plea deal that could include 10 years in prison and a fine of at least $20 million, sources close to the case told The Associated Press.
Andrew Fastow's attorneys haven't said if he would cooperate with investigators, but a guilty plea from him would be a significant break in the Justice Department's two-year investigation into Enron's 2001 collapse.
Justice Department spokesman Bryan Sierra said the investigation would continue with or without plea deals with the Fastows.
Neither Lay nor Skilling has been charged and both maintain their innocence.
"Nothing changes as to our firm belief that an objective fact-finder would conclude that Mr. Skilling did not do anything wrong," Bruce Hiler, Skilling's attorney, said Friday.
Mike Ramsey, Lay's attorney, said Lay has no worries if Fastow tells the truth.
Andrew Fastow faces 98 counts including fraud, money laundering, conspiracy and insider trading. Lea Fastow is charged with six counts of conspiracy and filing false tax forms for allegedly participating in some of her husband's deals and failing to report income.
The Fastows, both 42, are free on bond -- $5 million for him, $500,000 for her. His trial is set for April. A ruling from the judge in his case on a request from his legal team to move Andrew Fastow's trial out of Houston and preferably out of Texas is pending.
