6A THE UNIVERSITY DAILY KANSAN
NEWS
FRIDAY, SEPTEMBER 16.2005
Westar execs to repay company
COURTS
BY DAVID TWIDDY THE ASSOCIATED PRESS
KANSAS CITY, Kan. — A federal jury on Thursday ordered two former Westar Energy Inc. executives found guilty of looting the utility to hand over millions of dollars in cash and assets linked to their crimes — but much less than federal prosecutors had sought.
Following a day of deliberations, jurors told former chief executive David Wittig to hand over his Topeka home, the historic Landon Mansion, thousands of shares of stocks, a life insurance policy and $9.7 million in bonuses and other payments made while working at the Topeka-based utility.
His co-defendant, former chief strategy officer Douglas Lake of New Canaan, Conn., was ordered to turn over $2.5 million in stock dividends and sales, as well as several thousand stock shares.
Both men also must forfeit any award they receive from an ongoing arbitration fight they're
"We're obviously still disappointed in the main verdict and will vigorously appeal that to the 10th Circuit (Court of Appeals)."
Attorney for Douglas Lake
Edward Little
having with Westar over pay and benefits they say the company still owes them.
Prosecutions had asked the two men to forfeit all the salary and benefits they had received before being forced out of the company in late 2002, which came to $27.9 million from Wittig and $9.4 million from Lake.
Lake's attorney, Edward Little, said he considered the verdict a "win" for his client.
U. S. Attorney Eric Melgren, whose office prosecuted the case, had little comment on the verdict, beyond commending attorneys and investigators
in the case.
"We're obviously still disappointed in the main verdict and will vigorously appeal that to the 10th Circuit (Court of Appeals)." Little said. "At least the jury (on the forfeiture charge) didn't go overboard and didn't believe the government's argument that everything was a fraud."
everything was at Wittig's attorney, Adam Hoffinger, didn't immediately return a phone call seeking comment.
The same jury convicted Wittig on Monday of 39 counts, including a count of conspiracy, seven counts of wire fraud, 14 counts of circumventing internal controls and 17 counts of money laundering while running Westar.
Lake was found guilty of 30 counts, including one count of conspiracy, six counts of wire fraud, 13 counts of circumventing internal controls and 10 counts of money laundering. Lake was acquitted of seven counts of money laundering.
one count of circumventing internal controls and one count of wire fraud.
U. S. District Judge Julie Robinson on Thursday scheduled their sentencing for Jan. 9.
They face up to five years each for the conspiracy count, 10 years for each count of circumventing internal controls, 20 years for each count of wire fraud and 10 years for each count of money laundering.
Prosecutors said the men engaged in a number of schemes aimed at inflating their compensation and then hiding it from the company's board of directors and shareholders.
tors and shackles Following the trial, the jury had to consider a final count of forfeiting any property linked to the crimes, which required its own hearing. During that two-day hearing, prosecutors argued that Wittig and Lake had joined Westar with the intention of looting it, meaning everything they had received while at the company should be considered ill-gotten goods and surrendered to the government.
New Orleans begins to 'breathe' again
BY BRETT MARTEL
THE ASSOCIATED PRESS
NEW ORLEANS - Mayor Ray Nagin announced yesterday that large sections of the city will reopen next week, and the historic French Quarter the week after that. "The city of New Orleans will start to breathe again," he said.
safe. The announcement came amid progress in restoring power and water service and the day after the release of government tests showing that the floodwaters still contain dangerous bacteria and industrial chemicals, but that the air is safe to breathe.
residents will be Algiers, across the Mississippi River from the French Quarter, on Monday, the mayor said. The city's Uptown area, which includes Tulane University and the Garden District, will be reopened in stages next Wednesday and Friday, he said.
The French Quarter will follow on Sept. 26.
The first section to reopen to
low on Sept. 18.
"The French Quarter is high and dry, and we feel as though it has good electricity capabilities," the mayor said, "but since it's so historic, we want to double- and triple-check before we fire up all electricity in there to make sure that, because every building is so close, that if a fire breaks out, we won't lose a
significant amount of what we cherish in this city"
The reopened areas represent 182,000 residents out of a city of nearly half a million.
nearly half a million.
"We will have life. We will have commerce. We will have people getting into their normal modes of operations, and the normal rhythm of the city of New Orleans that is so unique," the mayor said. He added: "It's a good day in New Orleans. The sun is shining. ... We're going to bring this city back."
Nagin said there should be power in areas where people would be allowed back. But the water would be good only for flushing toilets, not for drinking and bathing, he said.
The mayor said major retailers would use the city's Convention Center to supply returning residents with food, wood and other things they would need.
The return will mark the start of what the mayor said will probably be the biggest urban reconstruction project in U.S. history.
"My gut feeling right now is that we'll settle in at 250,000 people over the next three to six months, and then we'll start to ramp up over time to the half-million we had before and maybe exceed," he said. "I imagine building a city so original, so unique that everybody's going to want to come."
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