Ex-Enron VP gets reduced sentence for insider trading

[JURIST] Ex-Enron [JURIST news archive] vice-president Paula Rieker was sentenced Friday to 2 years probation for insider trading, avoiding up to ten years' imprisonment. Judge Melinda Harmon [official website] of the US District Court for the Southern District of Texas [official website] reduced Rieker's sentence in exchange for her cooperation with investigators in the prosecutions of Enron founder Kenneth Lay and CEO Jeffrey Skilling [Houston Chronicle profiles] and for her community service. The former executive was also ordered to pay $50,000 in fines in addition to the $800,000 she has already repaid to Enron's defrauded investors. Rieker, whose culpable actions include fraudulently claiming that she did not trade stock illegally and using bonuses to persuade employees to remain with the company, testified that Lay and Skilling intentionally misrepresented company earnings.

Last month, former Enron CFO Andrew Fastow [Houston Chronicle profile] received a reduced sentence [JURIST report] as part of his plea agreement [text, PDF] based on his cooperation [JURIST report] in the prosecutions of Lay and Skilling. Enron, once the seveneth largest company in the US, collapsed in December 2001 due to allegations of serious accounting fraud amounting to $60 billion in market value. AP has more.



 

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