Federal prosecutors apparently are increasing their efforts to determine whether former Enron Corp. Chairman Kenneth Lay and CEO Jeffrey Skilling should face criminal charges, the Wall Street Journal reported on Tuesday. Both Lay and Skilling have repeatedly denied any wrongdoing during their tenure at Enron, but investigators apparently are focusing on “individuals who possess evidence” to decide whether they could pursue criminal charges against one or both men.

A Department of Justice (DOJ) spokesman declined to comment, but said the Enron investigation is “ongoing.” Meanwhile, a secret federal grand jury in Houston has been hearing evidence related to the bankrupt energy trader for more than a year, and “the investigation is clearly moving into a very aggressive stage,” a source told the Journal. Among other things, Leslie Caldwell, who heads up the investigation and has been splitting her time between the DOJ’s Washington, DC office and Houston, is moving to Houston full time.

To date, 19 former Enron employees have been charged in the wide-ranging federal investigation, but no civil or criminal indictments have been filed against Skilling or Lay. Nearly all of those indicted were executives who worked with former CFO Andrew Fastow, whose trial is set for April 2004 (see Daily GPI, Sept. 8).

According to the Journal, federal investigators now are warning certain witnesses that they may face a “change of status” and rather than being treated only as a witness, “such an individual could become subject to possible criminal charges.” Pressure apparently is being applied in cases where investigators believe individuals have not been completely forthcoming.

The only person who has been acknowledged publicly to be cooperating with the investigation is former Enron executive Michael J. Kopper, a former finance executive who worked under Fastow. Kopper pleaded guilty last year to twin counts of felony conspiracy to commit wire fraud and money laundering and is cooperating in the federal investigation (see Daily GPI, Aug. 22, 2002). He also is the only former Enron official so far to admit any wrongdoing in the accounting scandal.

However, federal prosecutors also are apparently working on a plea agreement with Ben J. Glisan, Enron’s former treasurer and Fastow protege, who was indicted last May (see Daily GPI, Sept. 2). Sources told the Journal that the case could turn if a plea bargain agreement with Glisan is completed, and that agreement may be completed as early as this week.

Enron prosecutors separately are considering criminal charges against other individuals, possibly within the next few weeks, the newspaper said. Among other things, the activities of officials at investment banks and banks that helped Enron establish the complex financial structures that are central to the criminal probe are being investigated. Merrill Lynch & Co., J.P. Morgan Chase & Co. and Citigroup Inc. settled civil charges earlier this year, without admitting or denying wrongdoing.

©Copyright 2003 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.