Enron Executive admits he is a fraudster

A former top executive in bankrupt energy giant Enron’s finance division today admitted money laundering and wire fraud when he appeared in a Texas court.

He is the first company official to be convicted since Enron collapsed last year.

Michael Kopper, 37, who was managing director of Enron Global Finance under former chief financial officer Andrew Fastow, quit the company months before its collapse to run one of several partnerships created by Fastow and credited with fuelling the company’s failure.

As part of his agreement to cooperate with the government, he agreed to surrender almost €12.5m in illegally obtained assets.

Houston Judge Ewing Werlein set Kopper’s bail at €4.7m.

Investigators are looking into whether Enron managers, from former chairman Kenneth Lay down, knew the network of partnerships - largely backed by Enron stock - was being used to hide debt and inflate profits.

Former federal prosecutors say Kopper, as a one-time top lieutenant to Fastow, will be able to lead investigators through the complex web of accounting and financial transactions that prompted Enron’s dizzying crash, leaving the company bankrupt, thousands of workers jobless and millions of investors with nearly worthless stock.

“He embodies the perfect cooperating witness because he is not viewed by the public as being one of the most culpable defendants, but at the same time, he has a vast array of knowledge and can point the government in the right direction,” said Robert Mintz, a former Justice Department prosecutor.

When Enron filed for bankruptcy last December, it was the largest such filing in US history. Millions of investors lost money and thousands of current and former Enron workers lost the great bulk of their retirement savings.

It also led to the unravelling of Arthur Andersen, the auditing firm convicted of shredding documents to obstruct a Securities and Exchange Commission investigation of Enron’s accounting practices.

Since then, executives from Andersen and other major companies, including WorldCom and Adelphia, have been accused of improper accounting.