Former NatWest bankers to face Enron extradition proceedings

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Former NatWest investment bankers to face Enron extradition proceedings
By Katherine Griffiths, in New York
27 September 2004

The Independent

Three former senior bankers from the capital markets division of NatWest will tomorrow face an attempt by the US government to extradite them to stand trial on charges that they defrauded their employer to make money for themselves and for contacts at the collapsed energy giant, Enron.

David Bermingham, 41, Giles Darby, 42, and Gary Mulgrew, 42, have been charged with conspiracy to defraud. They are the subject of a concerted attempt by US investigators into the Enron scandal to force them to travel to the US, where they could be immediately put in prison ahead of a trial in Texas.

They were managing directors of Greenwich NatWest, a NatWest subsidiary now owned by Royal Bank of Scotland, when they are alleged to have carried out the fraud in 2000.

The US Department of Justice claims the three persuaded NatWest to sell its interest in a company called LJM Swap Sub for less than it was worth. It is alleged the three each pocketed $2.3m (£1.28m) and made more than $12m profit for two executives at Enron, which had links with LJM. The executives - the former chief financial officer Andrew Fastow and his colleague Michael Kopper - have admitted their role in the alleged scheme, as part of a plea bargain.At a preliminary hearing at Bow Street magistrates' court in June, John Hardy, for the US government, saidthe three defendants acted "effectively together and in conjunction with two high-ranking employees of Enron". He said: "Enron purchased Swap Sub at a price that did not reflect the true market price and deprived their employers Greenwich NatWest of the true value of their interests and pocketed the difference themselves."

More:
http://news.independent.co.uk/business/news/story.jsp?story=566096

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1. Seven indictments of "wire fraud": Justice Dept

The US Department of Justice has brought seven indictments of "wire fraud" relating to the deal, covering e-mails and faxes sent four years ago. Each carries a maximum term of five years.

The three claim the US government has no jurisdiction to extradite them to Texas, but at the June hearing, District Judge Nicholas Evans said the charges came under legislation governing extradition.

While Mr Bermingham and his associates are not accused of playing a role in the Enron collapse, the case is one of a number of attempts by the US government's Enron taskforce to implicate the investment banking community in Enron's irregular financial practices.

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