- The Washington Times - Monday, September 12, 2005

KANSAS CITY, Kan. (AP) — A federal jury yesterday found two former Westar Energy Inc. executives guilty of charges they looted the state’s largest electric utility of millions of dollars.

Prosecutors charged that the two men, who were forced out of Westar in late 2002, engineered extravagant salaries and benefits for themselves at the expense of shareholders and hid much of their actions from the company’s board of directors and federal regulators.

Former Chief Executive Officer David Wittig was found guilty of 39 counts of conspiracy, wire fraud, circumventing internal controls and money laundering while running the Topeka-based company.

Former Chief Strategy Officer Douglas Lake was found guilty of 30 counts of conspiracy, wire fraud, circumventing internal controls and money laundering. Lake was acquitted of seven counts of money laundering, one count of circumventing internal controls and one count of wire fraud.

The jury of 10 women and two men deliberated for 7 days before reaching the verdict. The panel received the case late Aug. 24 after prosecutors and defense attorneys made their closing arguments 10 weeks after seating the jury.

Testimony about whether the government can recover money from the executives is expected to start today.

It was the former executives’ second trial. Their first ended in mistrial last year after jurors were unable to reach a consensus on more than half the charges.

Wittig, 50, and Lake, 55, looked straight ahead as the verdicts were read. Wittig at times stared at the jurors, but few if any made eye contact with him.

Attorneys on both sides refused to comment immediately after the verdicts.

Prosecutors said the men regularly used company planes for vacations and other private trips, attempted to secure huge windfalls from a proposed merger with a New Mexico utility and spinoff of Westar’s nonregulated subsidiaries, abused a program that paid executives for relocating to Topeka, and used Westar lawyers to rid the board of directors of their critics.

The duo denied the charges, saying their actions were legal, approved by the company’s directors and disclosed in corporate filings.

Each count of wire fraud, the most serious of the charges against the men, is punishable by up to 20 years in prison and a fine of up to $1 million.

Each conspiracy count is punishable by up to five years and fines, the accounting control counts by up to 10 years and fines, and the monetary transactions counts by up to 10 years and fines.

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