Houston – A personal accountant to Enron Corp. founder Ken Lay testified Monday she was unaware when she transferred money from loans Lay had obtained that federal regulations barred use of some of the money for stock purchases.
Sherrie Gibson, contradicting her own grand-jury testimony, said sometimes she decided herself which of Lay’s multiple lines of credit to use.
“It’s not accurate to say he told me every time,” she said, testifying in the second day of Lay’s bank-fraud trial.
After saying prosecutors made her feel pressured to testify that Lay always picked the lines of credit for stock purchases, Gibson added that she did not intend her actions to be deceptive.
“I never think in terms of sneaky,” she said under cross- examination.
Gibson testified in a grand- jury investigation of Lay before his 2004 indictment on one charge of bank fraud and three charges of making false statements on loan documents. The case was part of the larger conspiracy indictment against Lay and former Enron chief executive Jeff Skilling, but U.S. District Judge Sim Lake, ruling in October 2004 on a Lay request to have his case heard separately, said only the banking counts would be tried separately.
The trial is being heard without a jury by Lake, who also has presided over the four- month-long fraud and conspiracy trial of Lay and Skilling. Jury deliberations in that case were continuing for a third day as evidence was being presented in the bank-fraud case.
Defense lawyers said Lay would testify in this case too.
The government rested its case after testimony from FBI agent Robert Cunnane, who specializes in white-collar fraud. Cunnane said he reviewed thousands of related documents and testified in minute detail on the trail of Lay’s stock purchases, from the loans to wire-transfer orders to the brokers. The documents included Lay’s signature on notes promising not to use the money to buy stock on margin.
“The statements that the funds would not be used to buy margin stock were not true because funds were used to buy margin stock,” Cunnane said.
