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Andrew Fastow
Former Enron CFO who designed 3,000+ off-balance-sheet partnerships to hide billions in debt while secretly enriching himself by $45 million
Former Chief Financial Officer, Enron Corporation
Overview
Andrew Stuart Fastow served as Chief Financial Officer of Enron Corporation from 1998 to 2001 and was the principal architect of the massive financial fraud that destroyed the company. A graduate of Tufts University and Northwestern Kellogg School of Management, Fastow was hired by Jeffrey Skilling in 1990 from Continental Illinois National Bank. He rose rapidly through Enron ranks by creating increasingly complex structured finance vehicles. As CFO, Fastow designed and managed over 3,000 special purpose entities (SPEs) including the infamous LJM1, LJM2, Chewco, and the four "Raptor" hedging vehicles used to move billions in debt off Enron balance sheet and manufacture phantom profits. The Enron board of directors twice waived the company ethics code to allow Fastow to personally manage and profit from these entities while simultaneously serving as CFO, a staggering conflict of interest. Fastow personally pocketed at least $45 million from these partnerships. When the fraud unraveled in October 2001, Fastow was removed as CFO after banks refused to extend credit while he remained. He was indicted on 78 counts (later expanded to 98) including fraud, money laundering, conspiracy, and insider trading. In January 2004, Fastow pleaded guilty to two counts of wire and securities fraud, agreed to forfeit $23.8 million in assets, and became the key prosecution witness against CEO Jeffrey Skilling and Chairman Kenneth Lay. His testimony was devastating and central to their convictions. Fastow was sentenced to 6 years in federal prison (the judge reduced from the 10-year maximum for his cooperation). He was incarcerated at Federal Prison Camp near Pollock, Louisiana, released to a Houston halfway house in May 2011, and fully released in December 2011. After prison, Fastow has worked as a document review clerk and become a paid speaker on business ethics, describing himself as a cautionary tale. He invested in KeenCorp, an AI analytics company, in 2016.
Key Affiliations
Enron Corporation
Chief Financial Officer (1998-2001); previously Managing Director of Finance
corporation
Continental Illinois National Bank
Structured Finance (pre-Enron, hired by Skilling 1990)
corporation
LJM1 Capital Management / LJM2 Co-Investment LP
Founder and Managing Partner (personal profit vehicle)
corporation
Controversies & Concerns
Designed and managed over 3,000 special purpose entities (SPEs) including LJM1, LJM2, Chewco, and the Raptor hedges used to hide billions in Enron debt and fabricate earnings. The Enron board waived its ethics code twice to permit Fastow dual role as CFO and partnership manager.
Personally profited at least $45 million from the partnerships he created and managed as CFO while simultaneously owing fiduciary duties to Enron shareholders. Told the board he spent "no more than three hours a week" managing the partnerships.
Indicted on 78 counts (expanded to 98) including wire fraud, securities fraud, money laundering, conspiracy, and insider trading. Cooperated with prosecutors and became the key witness against Skilling and Lay, delivering testimony central to their convictions.
Wife Lea Fastow, who served as Enron Assistant Treasurer, was convicted on a separate tax fraud charge related to concealing income from off-books partnerships. Sentenced to 1 year in prison after the judge rejected her initial plea deal as too lenient.
Related Investigations (1)
Criminal Charges & Violations
2 documented violations
convictedWire Fraud (18 U.S.C. 1343)(2004-01-14)
convictedSecurities Fraud (15 U.S.C. 78j(b))(2004-01-14)
Known Associates & Connections
Jeffrey Skilling
Enron CEO who hired Fastow and approved SPE fraud structure. Fastow testified against him at trial.
Kenneth Lay
Enron Chairman who approved board waiver of ethics code for Fastow partnerships. Fastow testified against him at trial.
Lea Fastow
Wife and Enron Assistant Treasurer. Convicted of tax fraud for concealing partnership income. Sentenced to 1 year.
Michael Kopper
Fastow chief lieutenant at Enron. Managed Chewco and other SPEs. First Enron executive to plead guilty (August 2002).
Sherron Watkins
Enron VP who warned Lay about Fastow accounting schemes in August 2001
Ben Glisan
Enron Treasurer who participated in structuring Fastow fraudulent SPE transactions
Sources & Documentation
4 documented sources from official records, investigations, and reports
Personal Information
- Born
- December 22, 1961
- Birthplace
- Washington, D.C., United States
- Also Known As
- Andy Fastow
Education
- •Tufts University (BA, Economics and Chinese, 1983)
- •Northwestern University, Kellogg School of Management (MBA, 1986)
Key Timeline
1961-12-22
Born in Washington, D.C.
1983
Graduated from Tufts University with BA in Economics and Chinese
1984
Married Lea Weingarten (from the prominent Houston Weingarten supermarket family)
1986
Graduated from Northwestern University Kellogg School of Management with MBA
1990
Hired by Jeffrey Skilling to join Enron from Continental Illinois National Bank and Trust Company
1997
Created Chewco SPE to buy out CalPERS stake in JEDI partnership, beginning the off-balance-sheet fraud architecture
1998
Named Chief Financial Officer of Enron Corporation. Begins designing hundreds of off-balance-sheet entities to conceal debt.
1999
Created LJM1 and LJM2 partnerships with Enron board approval (ethics code waived twice). Personally manages and profits from entities designed to hide Enron losses.
2001-10-24
Removed as Enron CFO after banks refuse further lending while Fastow remains. Board discovers $45M+ in personal profits from LJM partnerships.
2001-12-02
Enron files Chapter 11 bankruptcy, largest in US history at that time ($63.4 billion in assets).
2002-10-31
Indicted on 78 counts including fraud, money laundering, conspiracy, and insider trading. Charges later expanded to 98 counts.
2004-01-14
Pleads guilty to two counts of wire and securities fraud. Agrees to forfeit $23.8 million and cooperate as key prosecution witness in exchange for 10-year maximum sentence.
2006-01-30
Testifies as star prosecution witness at Skilling/Lay trial. Testimony includes detailed descriptions of how SPE fraud worked and what Skilling and Lay knew.
2006-09-26
Sentenced to 6 years in federal prison (judge reduced from 10-year maximum for cooperation). Incarcerated at Federal Prison Camp near Pollock, Louisiana.
2011-05-18
Released from prison to Houston halfway house
2011-12-16
Fully released from custody. Begins working as document review clerk and paid ethics speaker.
2016
Invested in KeenCorp, an AI analytics company focused on measuring employee engagement