David Delainey, a former Enron Corp. executive who testified for the prosecution in the trial of former Enron chiefs Jeffrey Skilling and the late Kenneth Lay earlier this year, was sentenced to two-and-a-half years in prison on Monday.

Delainey, who at various times served as CEO of Enron Energy Services and Enron North America, pleaded guilty in October 2003 to manipulating earnings and insider trading charges, and he agreed to cooperate in the Enron Task Force investigation (see Daily GPI, Oct. 31, 2003). Delainey was considered one of the key witnesses against Skilling. Delainey testified during the four-month trial that he and other executives, including Skilling, had often lied to investors and employees about Enron’s financial health (see Daily GPI, March 1).

In Houston, Delainey’s lawyer John Dowd asked that his client receive probation, but U.S. District Judge Kenneth Hoyt did not agree. Hoyt ordered Delainey into federal custody immediately pending an assignment by the U.S. Bureau of Prisons regarding where he will serve his term. Hoyt also ordered Delainey pay an additional $60,000 to be distributed to a fund set up for Enron victims. Delainey already has forfeited nearly $4.26 million from his Enron earnings to the government, and he paid a $3.74 million fine to the Securities and Exchange Commission.

“I just want to say I’m so very sorry for my conduct,” Delainey told Hoyt. “I’ve done everything in my power to right the wrong.”

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