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From “Pillsbury Doughboy” to felon. In contrast to some of Enron Corp.’s hard-charging executives, ex-chief accounting officer Richard Causey was calm, dutiful and so friendly that he earned the nickname of the character from the TV commercial. But on Wednesday, the 45-year-old unemployed accountant ended his legal fight with the government and pleaded guilty to securities fraud. The plea deal came less than three weeks before Causey was to stand trial with his former bosses, Enron founder Kenneth Lay and former CEO Jeffrey Skilling. Now he’s a key potential prosecution witness against Lay and Skilling, with whom he has been aligned since their indictments followed his last year. A judge pushed the Jan. 17 trial back two weeks to Jan. 30 to give lawyers for Skilling and Lay time to prepare for a possible Causey assault. Prosecutors said in court they plan to begin debriefing him immediately, meaning they will assess what ammunition Causey has to help them pursue convictions of the biggest Enron fish of all more than four years after the company crashed in spectacular scandal. Causey’s arrangement included a five-page statement of fact in which he admitted that he and other senior Enron managers made various false public filings and statements. The statement does not identify Skilling or Lay. “Did you intend in these false public filings and false public statements, intend to deceive the investing public?” U.S. District Judge Sim Lake asked. “Yes, your honor,” replied Causey, who said little during the short hearing. But lawyers for Skilling and Lay described Causey as an honest man willing to admit to a crime to avoid a lengthy prison sentence if a jury rejects his claims of innocence. “They broke an innocent man,” said Daniel Petrocelli, Skilling’s lead attorney. Causey agreed to serve seven years in prison — which prosecutors can recommend dropping to five if pleased with his cooperation — and forfeit $1.25 million to the government. That amount of cash is much less than multimillions turned over by many of the 15 other ex-Enron executives who have admitted to crimes. Former finance chief Andrew Fastow, who masterminded schemes to manipulate Enron’s books while skimming millions for himself on the side, agreed to forfeit nearly $30 million in cash and property when he pleaded guilty to two counts of conspiracy in January 2004. Causey’s lawyers have repeatedly noted in filings that their client didn’t have the resources to set aside $20 million-plus for legal fees like Skilling and Fastow, often forcing them to tag on to the wealthier defendants’ trial preparation efforts. Michael Ramsey, Lay’s lead lawyer, hinted Causey’s diminishing resources likely fueled his decision to plead guilty. “You have seen a man who has been broken financially, who has been threatened with enormous prison term who has a family and young children that we have stood shoulder to shoulder with, broken bread with, talked to. We understand him, understand his psychology and here he is pleading guilty to something that in my mind in all likelihood is not even a crime at all,” Ramsey said. But one of Causey’s lawyers, Reid Weingarten, said Causey entered the plea because it was the right thing to do. “What is true to the extent that he has any involvement in any upcoming legal proceedings, he will do one thing: He will tell the truth, because that is who he is, that is what he should do, and that is what he is going to do,” said Weingarten. He also represented former WorldCom CEO Bernard Ebbers, who was sentenced in July to 25 years in prison for orchestrating the $11 billion accounting fraud that toppled the telecommunications firm three years ago. Causey, 45, could be more damaging to Lay and Skilling than Fastow. Unlike his former peer, Causey didn’t skim millions of dollars for himself from shady deals. Also, Lay has repeatedly pointed to Fastow as the crook who abused his trust, highlighting the former finance chief’s acknowledged crimes. Causey’s sentencing was set for April 21 but could be postponed. The maximum penalty for securities fraud is 10 years in prison and a fine of $1 million or twice the amount illegally gained, followed by three years of probation. Causey, the government’s 16th cooperating witness in exchange for a plea, had faced more than 30 counts of conspiracy, fraud, insider trading, lying to auditors and money laundering. Many of the charges against Causey overlapped with the 35 counts of fraud, conspiracy, lying to auditors and insider trading pending against Skilling. The pair are accused of conspiring with others to fool investors into believing a wobbly Enron was healthy in the years leading to its December 2001 crash. The securities fraud count to which Causey pleaded guilty is among those also pending against Skilling. Some of Causey’s charges also overlap with the seven fraud and conspiracy counts pending against Lay, in which the former chairman is accused of perpetuating the ruse after Skilling’s abrupt resignation in August 2001. Skilling and Lay maintain that they neither committed nor knew of any crimes at Enron, and both have pleaded not guilty. Neither attended Causey’s plea hearing. Petrocelli told Lake his client and Lay needed at least a two-week delay of the trial because Causey’s plea has “wreaked some havoc” on their efforts to prepare for trial. Lake approved the postponement after Sean Berkowitz, head of the Justice Department’s Enron Task Force, said the government did not oppose it. Berkowitz said the Causey deal should streamline what had been expected to be a four- to six-month trial. Associated Press Writer Pam Easton in Houston contributed to this report. Copyright 2005 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.

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