- The Washington Times - Friday, June 30, 2006

HOUSTON (AP) — Federal prosecutors want Enron Corp. founder Kenneth L. Lay and former Chief Executive Officer Jeffrey Skilling to fork over nearly $183 million as a result of their convictions for perpetuating one of the biggest corporate frauds in U.S. history.

In a court filing yesterday, prosecutors asked U.S. District Judge Sim Lake to order the newly convicted businessmen to turn over that amount “in proceeds of the fraud conspiracy,” which includes bonuses, Skilling’s gains from stock sales, and Lay’s use of loans from Enron to pay down his personal debt, once at $100 million.

“The bonuses, the stock transactions of Skilling and the manipulation of the line of credit by Lay all generated proceeds that would not have existed but for the fraud scheme,” according to the filing.

Specifically, the government wants $139.3 million from Skilling and $43.5 million from Lay.

Skilling’s lawyers, with support from Lay’s, asked Judge Lake in a filing in mid-June to schedule a non-jury trial regarding asset seizure issues. The judge has yet to respond.

The government had intended to seize about $57 million in Skilling’s cash and property that have been frozen since he was indicted in February 2004, including his $5.1 million Mediterranean-style mansion in Houston.

Also marked for seizure was Lay’s $5 million condominium in one of Houston’s most exclusive high-rises.

With its request for a money judgment, the government wants Judge Lake to set an amount that Lay and Skilling have to pay and allow both to come up with the cash through selling assets and other means.

The men’s lawyers have not responded to yesterday’s filing.

Lay, 64, and Skilling, 52, were convicted of defrauding investors and employees by repeatedly lying about Enron’s financial strength in the months before the energy giant plummeted into bankruptcy protection in December 2001.

Skilling was convicted of 19 counts of fraud, conspiracy, insider trading and lying to auditors, and acquitted of nine counts of insider trading. Lay was convicted of six counts of fraud and conspiracy.

In a separate non-jury trial, Judge Lake convicted Lay of one count of bank fraud and three counts of lying to banks for obtaining $75 million in bank loans and then reneging on written promises not to use the money to carry or buy stock.

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