Mr Fastow of Enron fame, jailed for 10 years and forfeiting $23.8M in assets in 2006 is about to be released from prison next month. The date is anticipated is the 17thDec 2011, after serving most of his time in a low-security prison and more recently a halfway house prior to his release.
Originally faced with a maximum of 140 years in jail, he received lenient sentencing thanks to some good plea-bargaining based on informing on his colleagues (notably Kenneth Lay and Jeff Skilling) at Enron.
Interestingly, Fastow was the only executive fired by the Enron Board just days prior to the collapse due to the Board finding out that he made $45M for himself in his off balance sheet deals. Apparently the Board thought his financial wizardry as excessive. So not only has he been able to receive a lighter sentence he gets to keep at least $20M of his fraudulently obtained money.
From what I have researched in the media it would seem that Andy Fastow would fit the type of Arrogant Fraudster. It was said about him long ago that his critics:
‘…labeled him ”fast Andy” and the ”Betty Crocker of cooked books.” People who grew up with him judged him as extremely ambitious and recall how he quarreled with high school teachers over his grades.
Former Enron colleagues have called him prickly and a bully. They say that during angry bouts, he was known to leave profanity-laced messages on the voice mail of colleagues.
He could also be charming and generous, former colleagues said. (reported by David Barboza, 2002). His drive for power was noted very early on in school with these comments:
”High school politics wasn’t a big deal at our school but it was a big deal to him,” said Mark Liss, a classmate at New Providence High who beat him in a race for class president. ”I remember how depressed he was; student government meant everything to him.”
A year later, Andy Fastow was elected president of the student council…. Dwight Boud, [his English teacher] described Andy Fastow as a ”wheeler-dealer” who even negotiated to get his grades changed. (Barboza, 2002). He married an heiress to a large fortune in 1985, which gave him a platform to meet wealthy and influential individuals and was head hunted by an executive recruiter (nameless unfortunately), as one of Jeff Skilling’s first recruits. He became the mastermind behind the schemes that defrauded millions of dollars out of Enron into the pockets of Enron executives, including his own.
Apparently he was able to show convincing signs of remorse to the trial judge and this assisted in his lower sentence.
From the findings of the Arrogant Fraudster type there are indeed some parallels with corporate psychopathy. Lack of remorse is seen as one of those characteristics, however I found in my research that they tended used remorse at trial to reduce their sentences. Most times the judges in the cases would see through the mitigation attempts by the fraudster and it would be remarked upon in their judgements that the ploy did not work.
So it could still be argued that Fastow demonstrated signs of being a corporate psychopath by being able to persuade an experienced trial judge such as Ken Hoyt the US District Judge in attendance at the trial, despite the remorse shown.
The ability to charm people is one of the noted characteristics of psychopaths, even fooling Robert D. Hare the well-known psychologist who has studied imprisoned psychopaths for over 30 years who admits that even he has had the wool pulled over his eyes. This uncanny ability to charm is how the individual is able to succeed in pulling off frauds of this magnitude. Anyone else would fall apart with keeping up the charm, but not Mr Fastow, he managed to beam the charm to the right quarters for 11 years at Enron and this is despite the constant cry that his efforts to keep Enron afloat went unrecognised.
Fastow was part of the Enron dream team of the smartest guys in the room, Skilling may have had the vision, but it was Fastow who admitted giving them the means to implement the vision.
Psychopaths do not change, their unrelenting behaviour is meant to be able to be harnessed (Snakes in Suits) with their immense energy put into side projects. This may happen to Andy Fastow upon his release, that he may undertake projects that he feels will be satisfying. However, generally such satisfaction is grounded in their own needs being fulfilled and with a psychopath it is the need of power over others. Certainly the Arrogant Fraudsters in my research went on to repeat their offending behaviour even while on bail, convincing new employers that they were much maligned.
The outlook for Fastow would seem to be the same pathway as before, set in his early days of seeking power, perhaps it will be moderated to some degree, but more likely that we will be hearing more about Andy Fastow after his release. As they say in the media, “Watch this space…” it will be very interesting to see how this Arrogant Fraudster develops after his stint in prison.