A jury has convicted a former Enron Corp executive and four ex-Merrill Lynch & Co officials in the first criminal prosecution arising from the accounting fraud that led to the collapse of the energy trader.
Convicted of one count of conspiracy and two counts of wire fraud were former Merrill investment banking chief Daniel Bayly, 57; former Enron finance executive Daniel O Boyle, 48; former Merrill strategic financial group chief James A Brown, 52; former Merrill managing director Robert S Furst, 43 and former Merrill vice-president William Fuhs, 36.
Brown was also convicted of two counts of making false statements and Boyle was convicted of one count of making a false statement, after a six-week trial in Houston.
Former Enron accounting executive Sheila K Kahanek, 38,
The conspiracy and wire fraud counts each carry a maximum sentence of five years in prison. The false statement counts each carry a potential 10-year prison sentence.
Four witnesses are to testify before the jury about the size of the financial loss caused by the fraud. Under federal sentencing guidelines the amount of losses helps determine the severity of the sentences in financial fraud cases.
The defendants are scheduled to be sentenced separately in March, 2005.
The trial stemmed from Enron's 1999 sale to Merrill of a $7 million stake in three energy-generating barges.
Prosecutors said the deal was a disguised loan because Enron promised to pay Merrill back and that the energy trader committed fraud when it booked the loan as a $12 million profit so it could meet earnings estimates.
