- The Washington Times - Thursday, May 16, 2002

HOUSTON (AP) A few weeks after David B. Duncan was fired from Arthur Andersen LLP in January, he said he learned he was a target in the probe of mass shredding of Enron-related documents at the firm last year.
Mr. Duncan couldn't recall who told him as he testified yesterday during Andersen's obstruction-of-justice trial, but said he heard it sometime in February.
Mr. Duncan, the former Andersen partner in charge of Enron audits, maintained his innocence until early April when he decided to plead guilty to obstruction after "a lot of soul searching about my intent and what was in my head at the time."
Prior to that, Mr. Duncan had claimed innocence during a three-day marathon of meetings with federal and congressional investigators from Jan. 14 to Jan. 16, where he said he committed no crime by intentionally destroying documents to keep them out of the hands of the Securities and Exchange Commission.
He also invoked his Fifth Amendment right against self-incrimination Jan. 24 during an appearance before a congressional subcommittee investigating Enron's collapse. Mr. Duncan said he likely had his first inkling sometime in January that he might have done something wrong.
Mr. Duncan kept that to himself until March. At that time, he testified, he told his family that he might be guilty of a crime, even as he continued telling federal investigators he did nothing wrong by destroying Enron-related documents.
The same month, Andersen was indicted on federal charges of obstruction for shredding documents and deleting computer records related to Enron.
The indictment was unsealed March 14, and Andersen pleaded innocent to obstruction March 20. That day, Mr. Duncan said, the firm came to him with an offer to present a united front that neither broke the law. Mr. Duncan said he signed an agreement to that effect with the firm.
However, "right about that time, I was discussing the fact that I might have committed a crime with my family," he said.
Mr. Duncan testified he told members of Andersen's Enron audit team on Oct. 23 to comply with the firm's document retention and destruction policy after the SEC had begun probing the energy trader's finances.
He and others on the staff started destroying what they thought were extraneous Enron documents until the firm received a subpoena from the SEC on Nov. 9. Mr. Duncan said he thought it was acceptable to destroy documents until the subpoena came.
Mr. Duncan has admitted to illegally shredding documents and is cooperating with the government in exchange for lenience. Obstruction carries a maximum sentence of 10 years in prison, but prosecutors can recommend that Mr. Duncan be sentenced only to probation.
Yesterday was his third day of testimony, and it was the first under questioning from Andersen's attorney, Rusty Hardin.
During questioning by Mr. Hardin, Mr. Duncan told jurors he learned Andersen planned to fire him on Jan. 15 before he met with congressional investigators.
"At this time, you still believed you had not done anything wrong?" Mr. Hardin asked.
"Yes, that was what I believed at the time," Mr. Duncan said.


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