A jury has convicted four former Merrill Lynch & Co. (MER) executives and a former midlevel Enron Corp. (search) finance executive of conspiracy and fraud for helping push through a sham deal to pad the energy company's earnings.
The deal involved a bogus sale of interest in power plants mounted on barges to the brokerage at the end of 1999 so the energy company could appear to have met earnings targets.
A sixth defendant, a former in-house Enron accountant, was acquitted. Sheila Kahanek testified she consistently opposed a verbal promise that the government contended made the deal a loan — that Enron would resell or buy back Merrill's interest within six months.
Those convicted of conspiracy and two counts of wire fraud were: Daniel Bayly, Merrill's former head of investment banking; James A. Brown, former head of Merrill's asset lease and finance group; William Fuhs, a vice president who reported to Brown; Robert S. Furst, a former manager of Merrill's relationship with Enron; and Dan O. Boyle, a former Enron finance executive.
The verdict came after 21 hours of deliberations that began at the close of six weeks of testimony.