Published January 13, 2015
In a case against a corporation, the ultimate puzzle piece is when the first major witness flips, and that's what happened on Tuesday.
David Duncan, Andersen's global managing partner on the Enron team, is singing like a bird to federal prosecutors and pleading guilty to one count of obstruction of justice in federal court in Houston, Texas.
As the head of the Enron account, some attorneys see Duncan as the most prominent person to reconstruct the record before it all went to the shredder.
The charge, filed hours before Duncan entered his plea, said he "knowingly, intentionally and corruptly" persuaded others to obstruct the SEC probe.
"Duncan pleaded guilty is extraordinarily significant because it's the biggest break in the government case so far," said business legal ethicist Neil Getnick.
Now Duncan's in a position to criminally implicate senior officials at Andersen and at enron, such as Ken Lay and Joe Berardino.
Duncan was fired in January after Andersen admitted to massive shredding of Enron documents and for months, they've been firing back that he was acting all on his own and that senior management was totally oblivious to the degree of shredding going on in Houston.
"David Duncan could have been a renegade who went off the reservation. We don't know that,' said Greenberg Taurig's Les Corwin.
Obstruction charges can carry fines and up to 10 years in prison but its unclear whether the Department of Justice will recommend punishment since Duncan is pleading guilty. One thing is certain, the government is still going after Andersen and Enron.
And now they have a powerful witness to help them to do it.