(202) 514-2007 | TDD (202) 514-1888
WEDNESDAY, JUNE 23, 2004
GRAND JURY IN HOUSTON
RETURNS SUPERSEDING INDICTMENT AGAINST FORMER EXECUTIVES AT ENRON AND
WASHINGTON, D.C. - Assistant Attorney General Christopher A. Wray of the Criminal
Division, Enron Task Force Director Andrew Weissmann, and Assistant Director
Grant Ashley of the FBI's Criminal Investigative Division announced today that
a federal grand jury in Houston has returned a superseding indictment against
four former Merrill Lynch executives and two former Enron executives.
The superseding indictment was handed down in a case in which it is alleged
that the Enron and Merrill Lynch executives engaged in a year-end 1999 deal
(known as the "Nigerian Barge" transaction) involving the parking
of Enron assets with Merrill Lynch. That arrangement allegedly allowed Enron
to fraudulently enhance the year-end 1999 financial position that it presented
to the public and used to pay its executives unwarranted bonuses. The case
had been scheduled to be tried in Houston on June 7, 2004, but the trial was
continued by the district court until Aug. 16, 2004.
The superseding indictment adds against all defendants two wire fraud charges
arising out of the Nigerian barge transaction, and adds a false statement count
against Dan O. Boyle, 47, of Houston, a former vice president in Enron's Global
The six defendants charged in the eight-count superseding indictment are: Boyle;
Daniel Bayly, 56, of Darien, Connecticut, the former head of the Global Investment
Banking division at Merrill Lynch; James A. Brown, 51, of Darien, Connecticut,
the former head of Merrill Lynch's Strategic Asset Lease and Finance group;
William R. Fuhs, 35, of Denver, Colorado, a former vice president in Merrill
Lynch's Strategic Asset Lease and Finance group; Robert S. Furst, 43, of Dallas,
Texas, the former Enron relationship manager for Merrill Lynch in the investment
banking division, and Sheila K. Kahanek, 38, of Houston, Texas, a former senior
director in Enron's Asia/Pacific/Africa/China ("APACHI") transaction
If convicted of all charges against them, Bayly, Furst and Kahanek face a maximum
sentence of 15 years in prison. Brown and Fuhs face a maximum sentence of 30
years in prison if convicted of all charges against them. Boyle faces a maximum
sentence of 20 years in prison if convicted of all the charges.
In a separate agreement reached with the Department of Justice in September
of 2003, Merrill Lynch accepted responsibility for the conduct of its employees.
Merrill Lynch also agreed to cooperate fully with the continuing Enron investigation
and to implement a series of sweeping reforms addressing the integrity of client
and third-party transactions. Merrill Lynch also agreed to the appointment
of a monitor to oversee the implementation and enforcement of the reforms for
an 18-month period.
An indictment contains allegations that a defendant has committed a crime.
Every defendant is presumed innocent unless and until proven guilty.
The Enron Task Force investigation is continuing.
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