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Tuesday, 25 November 2008

Ex-NatWest Banker Transferred to U.K. to Finish Prison Sentence

By Laurel Brubaker Calkins and Thom Weidlich
Nov. 25 (Bloomberg) -- The first of three British former bankers who pleaded guilty in a $20 million Enron Corp. fraud scheme was transferred from the U.S. to the U.K. to serve out his sentence.
David Bermingham, 46, one of the so-called NatWest Three, was flown from New York to the U.K. Nov. 21, his lawyer Jimmy Ardoin said. Bermingham and his confessed co-conspirators, Giles Darby and Gary Mulgrew, also 46, worked for Royal Bank of Scotland Group Plc's Greenwich NatWest unit. The three have spent about six months in U.S. prisons.
Darby and Mulgrew were also granted court approval Nov. 6 to be returned to Great Britain. All three may be paroled as early as next November under U.K. law.
"He left on Thursday, and he landed on Friday," Ardoin said yesterday in an interview, confirming the former banker's arrival in Britain.
Bermingham, Mulgrew and Darby were charged with helping to skim about $20 million from the bank using an off-books partnership in a conspiracy with Enron executives Andrew Fastow and Michael Kopper.
After being extradited to the U.S. in 2006, the bankers remained in Houston under court-ordered electronic monitoring. They pleaded guilty to fraud in November 2007 and received 37- month prison sentences.
Mulgrew entered prison in April; Darby and Bermingham, in May. They are returning to England under a law that allows repatriation of criminals to their home countries with court approval. Unlike the U.S. federal prison system, Britain's permits parole.
Parole Dates
"They would be eligible for automatic release once they've served half their sentences," Mitchell Jeffrey, media officer with the British Consulate in Houston, said Nov. 6. "At that point, it will be up to the Ministry of Justice to review their cases."
In pleading guilty, the three agreed to the sentence and a total payment of $7.35 million in restitution to NatWest's parent company.
Their crime netted another $13 million for Fastow, Enron's chief financial officer, and Kopper, who managed the partnership, U.S. prosecutors said.
Bermingham, Mulgrew and Darby were originally charged with seven counts of wire fraud and faced as many as 35 years in prison if convicted. They were moved early this month from separate prisons to a transfer facility in New York in anticipation of their repatriation.
Overseas Transfers
There's no set period of time prisoners must remain in American custody before they are eligible for transfer to foreign prisons. The U.S. government's commitment to support the men's request to serve the bulk of their sentences in U.K. facilities was a key factor in their decisions to plead guilty, Bermingham's attorney Dan Cogdell said when they were sentenced.
The bankers were among 34 defendants in criminal cases resulting from the December 2001 collapse of Houston-based Enron, which plunged into bankruptcy after a widespread accounting fraud was made public.
More than 5,000 jobs and $1 billion in employee retirement funds were wiped out, and investors sued to recover more than $40 billion in losses. Enron, once the world's largest energy trader, was worth $68 billion at its share-price high in August 2000.
Fastow pleaded guilty to conspiracy to commit fraud at Enron and is serving a six-year prison sentence in Oakdale, Louisiana. Kopper got a three-year, one-month sentence and was fined $50,000. He served most of his term in a Texarkana, Texas, facility and is in a Houston halfway house awaiting release in January.
The case is U.S. v. Bermingham, 02-cr-00597, U.S. District Court, Southern District of Texas (Houston).

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