I don’t know what to make of this.
Andrew Fastow
“I’m always surprised when people ask me to speak about business ethics; it’s like getting Kim Kardashian to speak about chastity.”
These words, from the lips of Andrew Fastow, elicit generous laughs from a roomful of bankers and attorneys at Dallas’s Belo Mansion this past September. Over the course of the next hour, he will give a talk on the subject of corporate ethics entitled “Rules Vs. Principles” to the local chapter of the Turnaround Management Association, a talk regularly punctuated with lines like the above, lines designed to show he is fully aware of the evening’s irony. Fastow is bluntly, emphatically apologetic throughout, regularly returning to a mantra he seems to genuinely embrace: “I went to jail because I was guilty.”
He is in his early 50s but looks younger, especially for a man who spent five years in federal prison following his indictment by a federal grand jury—and subsequent guilty plea—on 78 counts of money laundering, fraud, and conspiracy. He looks handsome in an Aaron Sorkin sort of way, charming and charismatic, brilliant and quick-witted. Watching Fastow in Dallas, it’s easy to see how he became Enron’s financial wunderkind, CFO of what would become the seventh-largest company in America, at 36.
And then, a month and a half after his Dallas engagement, his nationwide redemption tour makes a stop in Houston.
It is a cool, rainy night downtown, and the ballroom at the Magnolia Hotel is as packed as Belo’s was. The speaker and his talk are the same, and the resemblance between Houston’s well-groomed, besuited TMA members and Dallas’s is uncanny. Still, something seems different. We notice that Fastow doesn’t seem to have gotten a haircut in the intervening weeks. We notice that he appears a bit disheveled and fidgety as he ascends to the podium.
“This is very uncomfortable for me,” he begins after a short, pensive silence. “Every time I do one of these presentations it’s uncomfortable, but especially so in Houston. I apologize ahead of time if I seem nervous, but I am.” A few minutes later, he gains enough footing to address the scandal head-on: “It embarrassed Houston tremendously. The impact on Houston was substantial. I wake up to this every day. I am tremendously embarrassed, ashamed, and most importantly, I’m very sorry.”
Many people, even former Enron employees, don’t seem to realize that Fastow is back. Released from a Louisiana federal prison camp in 2011, he returned to the Bayou City, his wife, Lea, and the couple’s two sons. Lea spent only one year in prison for her small role in the Enron financial scandal—she pled guilty to income tax fraud—while Andrew served a year for nearly every one he spent as CFO, every year he spent concocting new special-purpose entities to mask Enron’s enormous debts and support the off–balance sheet financing and mark-to-market accounting schemes that finally brought the company down. Enron presaged later scandals at Wall Street’s “too big to fail” banks and ushered in the Sarbanes-Oxley act, aimed at preventing such failures and frauds from disrupting the American economy in the future.
Fastow has apparently been giving lectures on business ethics for awhile now. I’d have gone with a Willie Sutton analogy rather than a Kim Kardashian one, but props to him for keeping up with pop culture. As I said, I don’t really know what to think about this. He’s done his time, and he’s hardly living large these days. I can’t honestly say that I wish him well, but I have no reason at this point to wish him ill. I hope he can do something good with the rest of his life.