Jamie Olis, Dynegy Inc.’s former senior director of tax planning, was resentenced in Houston Friday to six years in prison. Olis had been convicted in 2003 and sentenced to 24 years in prison for his part in helping Dynegy inflate its reported cash flow in 2001 through a complex scheme known as Project Alpha (see NGI, March 29, 2004).

Olis, ex-Dynegy vice president Gene Foster and Helen Sharkey, a former member of Dynegy’s risk control and deal structure group, originally were indicted in 2003 for their roles in the Project Alpha scheme (see NGI, June 16, 2003). Each were charged with criminal conspiracy, and securities, wire and mail fraud. Foster, who was Olis’ supervisor, and Sharkey agreed to cooperate with the federal government, and they pleaded guilty to conspiracy in August 2003.

Foster, who testified against Olis, was sentenced to 15 months in prison, three months probation and was given a $1,000 fine. Sharkey received a one-month sentence and a $10,000 fine.

Using federal sentencing guidelines based on investors’ losses, U.S. District Judge Sim Lake sentenced Olis to 24 years in prison, but upon appeal, his sentence was overturned last year by the 5th Circuit Court of Appeals (see NGI, Nov. 7, 2005). The resentencing had been delayed until prosecutors and Olis’ defense team could agree on a damages figure. Prosecutors earlier this month said they determined Dynegy’s shareholder losses related to Project Alpha were around $100 million, which supported the original 24-year sentence. However, they had recommended Olis receive 12-and-a-half years in prison.

Olis, who was resentenced by Lake after the judge reviewed the recommendations, already has served two years and four months in prison. He will be eligible for a reduction in his sentence for good behavior on the recommendation of the Bureau of Prison officials.

Because of Project Alpha, Dynegy had to restate its 2001 earnings and pay a $3 million fine to the Securities and Exchange Commission (see NGI, Sept. 30, 2002). The scandal also led, in part, to the resignation of many of Dynegy’s top officials, including CFO Rob Doty and founder and Chairman Chuck Watson (see NGI, July 1, 2002; June 3, 2002).

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