NatWest 3: Three Years Apiece

A federal judge in Houston today sentenced each of the so-called NatWest 3 bankers to a little more than three years in prison for their role in helping former Enron finance chief Andrew Fastow execute one of the many frauds that led to that company's collapse.

District Judge Ewing Werlein Jr. sentenced David Bermingham, 45, Gary Steven Mulgrew, 46, and Giles Robert Hugh Darby, 45, to 37 months in prison, in line with the punishment federal prosecutors had recommended.

All three men pleaded guilty to a single count of wire fraud as part of a plea agreement with authorities. Their lawyers have said the men will petition to serve part of their sentences in England. They've also agreed to pay more than $7 million to their former employer.

While working at Greenwich NatWest, a unit of Royal Bank of Scotland Group, the men were assigned to sell one of their employer's investments with Enron, prosecutors said.

They advised NatWest to sell the investment for $1 million to Southampton LP — an entity they secretly owned along with Fastow and his former deputy, Michael Kopper. Within weeks, Southampton resold the investment for $20 million, and the Southampton partners shared in the profit.

For their $250,000 investment in Southampton, the three defendants received a total of $7.3 million, or $2.83 million each, prosecutors said. Kopper, Fastow and others received about $12.3 million. The three NatWest bankers hid their participation from their employer throughout.

Speaking in court, Mulgrew acknowledged "a lack of integrity in my decisions." He also apologized to "the people hurt by my decisions."

Darby's lawyer, Dick DeGuerin, blamed "the Andy Fastow culture of greed at Enron" for having seduced his client and the others into participating in the fraud. "These guys were as much victims as anybody," he said.

by Mark Stein