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Defense Paints Enron's Fastow As Greedy Liar

Sherron Watkins Scheduled To Testify This Week

POSTED: 9:10 am MST March 14, 2006
UPDATED: 9:23 am MST March 14, 2006

Testimony in the Enron trial resumed Tuesday morning with jurors hearing from Chris Loehr, one of former Chief Financial Officer Andrew Fastow's employees at the LJM partnerships.

Prosecutors said that Sherron Watkins, the Enron executive who sent Lay a memo months before Enron's fall warning that Fastow's accounting schemes could wreck the company, should testify this week as well.

Defense teams for former Enron CEOs Kenneth Lay and Jeffrey Skilling pursued similar lines of attack against Fastow, painting him as a greedy liar with no hard evidence to back up his testimony against his ex-bosses.

The key prosecution witness on Monday wrapped up three days of rigorous cross-examination, insisting he was "ashamed to the core" by the crimes he committed.

He said he was in court only to tell the truth, not to put Skilling and Lay away.

Fastow has agreed to serve 10 years in prison after pleading guilty to two counts of conspiracy.

Skilling faces 31 counts of fraud, conspiracy, insider trading and lying to auditors for allegedly lying about Enron's financial strength.

Lay faces seven counts of fraud and conspiracy for perpetuating the alleged scheme after Skilling resigned in August 2001.

Both men have pleaded not guilty.

If convicted, each could face decades in prison and millions of dollars in penalties.

Enron was once the nation's seventh-largest company.

Before 2001, it was considered an innovative new-economy maverick and admired as a top stock performer. But a spectacular collapse left thousands jobless and slammed Wall Street with billions in losses.


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