Gary Mulgrew’s Book Excerpted In Daily Mail

Gary Mulgrew, one of the NatWest Three, has written a book titled Gang of One about his experience with the American justice system. The UK Daily Mail has excerpted the book; it sounds utterly horrific.

On the other hand, Mulgrew sounds utterly charming. For example:

‘Look,’ I said, speaking more quietly. ‘I’m not from around here, and I ain’t trying to be disrespectful. But I’m not part of your battles, and I won’t be part of your Brotherhood. I’m a Scot, from Scotland. I’m British. I play football and eat chips.’ Embarrassingly, they were the only British credentials I could muster.

Check out the article and pre-order the book here.

NatWest Three Featured On Extradition Website

This new site was created by Richard O’Dwyer, a young man accused of running a website which allowed others to access copyrighted material. The US is attempting to extradite him, though he hasn’t been in the USA since he was five years old.

There are several case studies on the site, including one about the plight of the NatWest Three. It is a quick read about an issue we should all care about.

The Human Rights Implications of UK Extradition Policy

David Bermingham of the NatWest Three is quoted through-out this report. This statement bothered me a great deal:

Mr David Bermingham told us about his experience of being extradited to the United States under Part 2 of the Act (commonly known as the “NatWest Three” case). He said that “with Article 6 [right to a fair trial], we knew we were always going to lose because it has long been European jurisprudence that the standard test that you must meet in order to demonstrate that your chances of a fair trial are slim is flagrant breach.” His case relied on Article 8 [right to private and family life]:

“what we argued [...] was it was neither necessary nor proportionate to extradite us because the case not only could but should have been heard in the UK because all of the facts, all of the evidence and substantially all of the witnesses were here.”
He concluded that “if we stick with the current framework of the Extradition Act there are basically no protections [of human rights]”.

It bothers me a great deal that he always believed he would lose.

Human Rights Implications of UK Extradition Policy

Today In Enron History

June 27, 2002, the Enron Task Force announced they had charged Gary Mulgrew, David Bermingham and Giles Darby with wire fraud against their employer, Greenwich NatWest, in a series of deals involving an investment in a partnership formed by Enron CFO Andy Fastow.

The Southampton deal was odd for several reasons, the first being that when the NatWest Three realized there might be some irregularities involving Fastow, they reported themselves to British authorities. If they were truly guilty, it makes one wonder why they were so eager to speak to the very people who could punish them.

Secondly, the guts of the accusation against them (that they vastly under-reported the value of an asset, urging Greenwich NatWest to sell at far below market value) was refuted by the so-called victim itself. NatWest said the asset was fairly appraised.

Third, the extradition process that would ensue for the NatWest Three would become a nightmare. The three British citizens, who worked for a London bank, would find themselves at the mercy of the post-9/11 weirdness that surrounded America’s attitude toward all foreigners, not just those carrying suicide belts but quite proper and ordinary citizens like the NatWest defendants. The US claimed authority to pluck three British citizens and deposit them in US courts. The NatWest Three pleaded to be tried in British Courts, which was where the supposed crime occurred, and where – not incidentally – witnesses and evidence of their innocence remained. But the US eventually won that battle, and the defendants were hauled before a Texas court where they were forced to plead guilty to an absurd crime and sent to American prisons, some five thousand miles from their families.

David Bermingham Discusses Shock At Fraud Accusations

David Bermingham was on a radio program yesterday speaking about his experience being ensnared in the Enron fraud charges.

David Bermingham Discusses Extradition

The Telegraph (UK) has a great article about David Bermingham’s plight to have extradition laws overhauled.

I found this quote heartbreaking:

“I am neither anti-American, nor am I anti-extradition and I will point that out quite early to the committee. This is not some form of anti-American crusade, far from it,” he said.

The United States was good to the NatWest Bankers until we went all crazy and captured them, threw them in a cage, and poked them with sticks. How can he NOT be anti-American after what he has been through?

Read the whole article; it is well worth your time.

Extradition In The UK

After my NatWest post that mentions Allen Stanford, I discovered that the UK coalition Government announced a review of the extradition laws, and now they are seeking submissions from people interested in sharing their views. The missive reads:

Members of the public can have their say on a review into the UK’s extradition arrangements from today.

Extradition is the process which allows countries to make formal requests to each other for the return of suspects to stand trial for a crime in the country it was committed.

An independent review of the UK’s extradition laws was announced by the Home Secretary in September. As part of that review, the public has until 31 December to contribute views.

Efficient and fair

The review panel is being led by the Rt Hon Sir Scott Baker and is focusing on five areas to ensure that the UK’s arrangements work both efficiently and in the interests of justice. These areas are:

the Home Secretary’s powers to stop extradition
the operation of the European Arrest Warrant, which deals with extradition requests between European countries
where a crime is mainly committed in the UK, whether the person should be tried here
whether the US-UK Extradition Treaty is unbalanced
whether requesting countries should be required to provide sufficient evidence to prove an allegation

Your views

The panel would like to hear from anyone who may wish to contribute to the review. You can put forward your views by email to: extradition.review@homeoffice.gsi.gov.uk.

I actually smirked when I read the item “whether the US-UK Extradition Treaty is unbalanced.” In a word: yes. It’s terribly unfair. The long arm of American law can reach into the smallest English shires to grab a British citizen, drag him across the pond and force him to stand trial whereas the US would simply scoff if the British government attempted the same to a citizen anywhere in the US.

I am asking anyone who is interested to please share your views with the UK Home Office. I believe it would be helpful for American citizens saying that the criminal justice system in the USA is not quite the bed of roses that the British are led to believe, and that sending citizens to the US without testing any evidence (as is currently the case) merely encourages those rotten apples in the prosecutorial barrel to be even more cavalier about the truth, knowing that the victory is assured once the defendant arrives on US soil. No American court would dream of allowing the reverse to happen to a US citizen.

It is too late to assist the NatWest Three. They’ve served their draconian sentences and have returned to their homes. But it is not too late to help others mired in the system.

Please send your views on extradition to: extradition.review@homeoffice.gsi.gov.uk

Please let it be known that the American justice system is biased toward prosecutors. For citizens of the UK, being extradited into the system is a certain conviction.

Allen Stanford and the NatWest Three

The WSJ has a story about Allen Stanford and a link to the UK’s Daily Mail which has some rather disturbing pictures of the accused ponzi schemer.

A few things jumped out at me about the story: 1.) We aren’t shown those photos in US publications. 2.) The NatWest Three were right to fight extradition to this country, which does not do a very good job of protecting people merely accused of a crime. Indeed the accusation process is one of the prosecution’s greatest tools to help punish those who might very well be innocent. With the perp-walks, the crushing emotional torture so illustrated by Stanford, and the small tactical games, such as lying about witnesses they intend to call, our “pre-justice” system is as wretched as the trial and punishment process.

I love my country. But I’ve grown weary of the abuses that take place casually in the criminal justice system – and even in the civil justice system. I’m weary of our acceptance that people such as Stanford will be beaten; officials shrug their shoulders and don’t give it another thought.

This is what the NatWest Three were being imported into. I have no idea if the same problems bedevil UK prisons, or if their justice system is a little more compassionate than ours (when I lived there, I never tangled with that particular aspect of English life.) But I know that our reputation for being monstrous to criminals probably proceeds us and in this instance, the NatWest Three had good reason to be concerned that they would be treated badly.

UK Guardian Publishes Snarky Article About NatWest Three

The UK Guardian has published an article with a rather snarky tone about the NatWest Three, which I will now dissect like the frog in seventh grade biology class.

They became poster boys for City fraud when they confessed to stealing $7.3m in an Enron-related fraud. But the convicted British bankers once dubbed the “NatWest Three” are now recanting their guilty pleas, claiming that they were extracted under duress by a flawed American justice system.

I suppose I should be flattered that the British press seems to insinuate that the possibility of being forced by the American justice system into confessing to a crime one did not commit is beyond the realm of reality. However, I am ashamed to say that in the USA, most of the men and women in prison are in there because of plea deals.

Recently released from prison after serving half of their 37-month jail sentences for a scam dreamed up with corrupt Enron executives, two of the NatWest Three, David Bermingham and Gary Mulgrew, are far from remorseful.

God, I love the Brits.

They have launched a ferocious attack on their controversial extradition from Britain to the US in 2005 and subsequent imprisonment, claiming that they only admitted fraud in order to get home as quickly as possible after frustrating delays in their criminal trial.

I spoke to one of them who said even in prison that his situation was completely ridiculous and he was innocent. I found that refreshing because everyone else I’ve spoken to in prison does the whole “I am pretending to be remorseful until I get out of here” dance. And if they say anything that would violate their agreement (which almost universally say that they are not allowed to utter one word in contradiction to the plea) they will be punished for perjury. I love that the NatWest men are angry and vocal about their anger. They should be mad.

In a two-hour-long video on the website Ungagged.net, which is dedicated to exposing “prosecutorial abuses” in the Enron saga, Bermingham has compared the US system of plea bargaining to “Stalinist Russia”, while Mulgrew asserts his ordeal was akin to “torture”.

Wait. Why the scare quotes around “prosecutorial abuse”? And I agree with Bermingham and Mulgrew that the entire situation showed the very worst of our monolithic justice system.

“They ripped me away from my home country, away from my family and friends,” said Mulgrew. “Torture takes many forms. They delayed the trial, delayed the trial.”

Bermingham and Mulgrew, along with a colleague, Giles Darby, were at the centre of a furore over Britain’s extradition treaty with the US that sparked questions in parliament and a march by business executives on the Home Office .

The trio persuaded their employer, Greenwich NatWest, to offload a stake in an Enron-related investment venture in the Cayman Islands for a rock-bottom price of $1m. Unbeknown to NatWest, they held a stake in the purchaser, through a deal cooked up with Enron’s then finance director, Andrew Fastow, and the conspirators sold on the investment at a profit of $20m.

This is written as the Official Story and it simply isn’t true. It’s mocking the seriousness of the trouble these men have faced.

Pleading guilty in front of a Texas judge in February 2008, the British bankers delivered grovelling apologies. Bermingham said his conduct “fell well below the standards expected” while Mulgrew accepted that an offshore transaction in the Cayman Islands “lacked integrity”, adding: “I apologise unreservedly for my actions.”

It pains me to think of them – or any of the Enron executives – apologizing for something I know they did not do. Ken Rice’s “I am ashamed of my actions… I was not raised that way,” haunts me. All of the apologies are just painful and horrible because they’re being forced to accept the burden for something they simply did not do. I am sure it was painful for them to say those things. But it is also painful to hear them.

But the men now say that their confessions were drawn out of them by the pressure of extradition to the US and a two-year hiatus in Houston with little money and minimal family contact.

Gee… ya think? You think maybe these men might have a point?

Bermingham said he feared a mistrial if a jury failed to reach a majority verdict, further prolonging the trio’s stay: “On the one hand, we were going to be able to show without any shadow of a doubt that the government’s case was bullshit. On the other hand, we were three greedy foreign bankers who’d done a deal with Andy Fastow and made $7m bucks. And you’ve got yourself a mistrial.”

Bermingham need only examine the Broadband case for a picture of what a mistrial or hung jury looks like in the USA. Rex Shelby, now gone from Enron for eleven years, has been prosecuted for nine. He’s been tried, been acquitted and some counts were hung. To the Fifth Circuit innumerable times, to the Supreme Court twice. And he’s going to trial again. An even more extreme example is Kevin Howard, another Broadband defendant who was tried twice and was set to go for a third time when he finally said enough was enough. If there is any comfort at all that I can offer Bermingham, it is that he was correct; a retrial would have been hell. He is home in Britain now where he belongs. He did the right thing – even if it was horrible that he had to be put in the position of doing it.

He added: “The government made it clear to us that if we agreed to plead guilty, they would recommend that we got sent home under the prisoner transfer treaty so that we could spend a good proportion, if not a majority, of our sentences in the UK where would could be close to our wives and families. But if we went to trial and lost, they said they would ensure we spent all of our sentence here [in the US].”

As part of their sentence, the trio were obliged to pay back $7.3m to Royal Bank of Scotland, which now owns NatWest. An RBS spokesman said they had reached a settlement: “The dispute between the parties has been resolved pursuant to an agreement, the terms and conditions of which are confidential.”

The US department of justice declined to comment on the bankers’ remarks.

The trio are now trying to rebuild careers in Britain. The men’s solicitor, Mark Spragg, said there were ongoing contentious cases of British business executives being extradited to the US, including a former boss of the Morgan Crucible engineering group, Ian Norris, who was sent to the US for trial in May.

“There’s a real issue here that businessmen being sent to America are under immense pressure to plead guilty to something even if they don’t feel they are guilty, because it’s the quickest way to get out of the system,” said Spragg.

It’s not even about “feeling” guilty. It is about knowing, objectively and without reservation, that your actions did not violate any law and that you are being pursued not in the interest of justice but in the interest of becoming a trophy for an attorney who wants more than anything to advance in her or his career, and you are the way to do it.

By cynical about the media reports. Don’t be cynical about the men – like Bermingham and Mulgrew and Darby – who were too innocent to even fathom that would end up in Texas, in prison, and we would know them as the NatWest Three.

What We Know Now About Enron

The video of David Bermingham and Gary Mulgrew on Ungagged.net has unveiled a trove of details about their case, but what strikes me the most is how similar the case was to all the others. There was a coordinated strategy among the Enron Task Force with a singular goal to get Ken Lay and Jeff Skilling. As Gary Mulgrew says in the video, “we were just in their way.”

Some examples of what I mean by a strategy:

The allegations against Gary Mulgrew, David Bermingham and Giles Darby center around a personal transaction they did with Andy Fastow. They were accused of misleading their employer about the value of an asset. Bermingham states in the video, “the asset was worthless.” Even NatWest, the entity they were accused of defrauding, told the FSA that they were “content with the price.”

This reminds me of the Nigerian Barge deal, in which all the parties were content with the deal, and yet the government strived to criminalize it. Oddly, or perhaps not, both deals were worth $7 million.

In February 2002, the FSA (which is the British version of the American SEC) investigation concluded. None of the NatWest defendants heard anything more about the investigation until June when they discovered – by watching television – that they were the subjects of criminal complains. They had never spoken to anyone at the Department of Justice.

This is like the Broadband defendants. Rex Shelby answered his door one August evening to find two FBI agents standing there. As they came inside, he asked if he was being accused of something. They said no. Later, a friend stated that they had been at his place too, and they had said “Shelby’s fingerprints are all over this.” Shelby offered numerous times to speak to the prosecutors in order to explain the EBS technology and they flatly refused him. The DOJ in the EBS and NatWest cases had no interest whatsoever in speaking to the actual people they were accusing.

In the video, Gary Mulgrew’s describes a horrific strategy in which the DOJ simply manipulated his email, taking phrases from one document, pasting them into another document. He said in the video that while reading the doctored emails, he said to his brother, “I must have had a lobotomy. It seems to me, reading this, I did this. I stole this money.” His astonishment is clear. He says, “I didn’t think these people lied. I didn’t think these people manipulated. I didn’t think that they would cut and paste and do things. I grew up watching Law & Order, and I thought these were good guys… and instead what you get is this contorted load of rubbish.”

He also discusses an internal RBS report from early 2002 when the Financial Services Authority were investigating the transaction after the NatWest Three had come forward to them and self-reported. The DOJ deliberately restricted their document subpoena to pre-bankruptcy times, because they didn’t want to get hold of reports like that which would have completely undermined their case. They knew of its existence, though, because the FSA sent a huge pack of documents (which the NatWest defendants had given them) to the SEC, under a covering note which included a summary of the FSA’s conclusions, including the information that RBS had been asked to go back and look at everything again and had concluded that all procedures had been folllowed and that the price paid was fair.

This, sadly, is par for the course. Despite the fact that the entire world say “the Enron dataset”, numerous important emails were kept from the Broadband defendants until well after the first trial. Other documents, such as the new discovery in the James Brown case, are clearly exculpatory and were released only on March 10, 2010. The manipulation of email and documents is shameful, but when the DOJ has a case to make, nothing – not even civil rights – is sacred.

Mulgrew also said Caldwell gave a speech in which she said that all the people in Washington were urging an indictment. This sadly is almost word-for-word what John Kroger said. He was eager to be the first to get some “scalps on the board.” His book, Convictions, details the passion with which he was determined to convict Enron executives whether or not they were guilty.

One of the most troublesome things in the prosecutions was the way the government used anyone and everyone to get Ken Lay and Jeff Skilling.

The charging document alleged that the NatWest Three conspired with Andy Fastow and Michael Kopper. The Three were charged. Michael Kopper and Andy Fastow were not. The document was used to get Kopper and Fastow to talk since they had pled the Fifth. When Michael Kopper talked, Andy Fastow still refused. Then they indicted his wife.

The NatWest Three and the Nigerian Barge defendants were used to go after Andy Fastow. Andy Fastow, Ken Rice, Kevin Howard, and Kevin Hannon were used to go after Skilling and Lay, which is who they really wanted. The fact that thirty-six other people got trapped under the wheels did not matter one bit to the DOJ. Lea Fastow, for God’s sake, was a mother with two young kids. And John Kroger openly admits that not only would her “crime” usually not be punished, but she was being punished BECAUSE HER HUSBAND REFUSED TO TALK!

All the men they sent to prison under pernicious plea deals had children and wives and lives. David Bermingham had a three month old baby when he discovered he was subject to a criminal complaint in the USA.

And yet it didn’t matter.

None of the lives of these people mattered one bit to the DOJ. They were happy to separate a father from his infant son, or in the case of Ken Rice, his four children or in the case of Lea Fastow, her two young boys. It simply made no impact on them at all that they were deeply hurting innocent people. And these innocent people had no recourse.

I am so proud of both Gary Mulgrew and David Bermingham for speaking out. I think the big break-through in the way Enron is perceived by the majority will come when those who did plea deals start speaking out too, when they let it be known that they were manipulated and used by the DOJ for the stupid reason of putting Jeff Skilling and Dr. Lay behind bars.

So thank you, Gary and David, for being the first.

David Bermingham and Gary Mulgrew Discuss Their Case on Ungagged.net

Just released! Beth Steier has two hours of footage of David Bermingham and Gary Mulgrew talking about Enron. Both are lovely people – you can see their genuineness in the video. In the fourth installment, you can see it is still painful for Gary Mulgrew to admit that Andy Fastow was a thief. That struggle, that hesitancy to acknowledge the darkness in another human being, touches me. Both are compulsively watchable. Both are innocent; it is impossible to believe otherwise once you see the video. Check it out!

NatWest Three, Conrad Black, and American Priorities

While discussing the Conrad Black case with a friend in Canada, I realized that I was using the same words when describing the NatWest Three. After considering it further, it looks as though these two cases have much more in common than it would appear at first glance.

My knowledge of Conrad Black is significantly less than the Enron cases, but I understand that Conrad Black was a Canadian citizen, who in 2001, gave up his citizenship to become British. In 2007, he was sentenced to six and a half years for defrauding shareholders in his Hollinger media empire out of $6.1m by attaching a “non-compete” clauses to the sale of newspaper businesses that siphoned off funds from investors.

As I said, I don’t know the details of his case or how he came to be tried in a Chicago court room. I only know that he did, and he was sent to Florida to serve a jail sentence.

The NatWest Three case, I know a bit better. Three good men named Gary Mulgrew, David Bermingham and Giles Darby were employed by a British bank, NatWest. They were accused of conspiring with Andy Fastow to defraud Enron – and though it is patently obvious they did no such thing, I will focus entirely on their citizenship for the purpose of this essay. According to the US attorney, the three British men, working for a British company, conspired in London to defraud Enron. At no time was any of their “fraud” committed on US soil.

The three men rightfully fought extradition to the USA. They were ultimately unsuccessful, having been extradited under the draconian Extradition Act of 2003, an act of the UK Parliament that allows the United States to extradite citizens of the UK for offenses committed against the United States, even if the offense was committed in the UK by a person living and working in the UK. There is no reciprocal law allowing the UK to demand US citizens appear in the UK.

The Three sued the UK government to stay in the UK and be tried in United Kingdom courts. They sued and sued and sued. To no avail. Finally, after all their options were exhausted, they were jettisoned to the United States.

These three foreigners, separated from their families, were forced to wear ankle monitors, stay in Houston, and they could not speak to one another without their lawyers present. This last rule is a bit odd since none of the other Enron defendants had to comply with such rigorous requirements. The Broadband Three, for instance, could confer with one another at will after they petitioned Judge Gilmore for the right. (It was granted, in order for them to work on their defense.)

The NatWest Three also had great difficulty getting any of their coworkers at NatWest to assist in their defense. Specifically they wanted the court to order six former colleagues living in Britain to provide video testimony for their defense. Their court filing states:

Several individuals now refuse to travel to the United States to appear on defendants’ behalf because they feel, or have been, threatened by the US government.

Their trial was repeatedly delayed. Their initial immigration visas was valid for a year; they ended up having to stay for over two. Finally they had enough of this nonsense and pleaded guilty to get it overwith.

They were then sent to various prisons to serve a term of thirty-seven months. They served their time, then immediately flew home to Britain. One could hardly feign surprise that their experience might have caused a somewhat negative impression of our great country.

In both the NatWest Three case and Conrad Black, the long arm of the USA was able to simply force other nations to hand over their citizens while, of course, the USA could simply thumb its nose at any other nation that required the presence of American citizens.

American zealousness to pursue white collar cases is untethered. The pursuit of white collar criminals is harsher than that of terrorists. There is a lot of talk about securing our borders and catching terrorists but really, it’s just talk. But open a newspaper and you see the government attacking white collar defendants with a vengeance. If they are from one of our closely allied countries – Britain or Canada – so much the better.

I simply don’t understand our American priorities.

Today In Enron History

Today in 1999, Enron completed the final process of setting up LJM1. Fastow gave a presentation at a board meeting attended by Skilling, Dr. Lay, Rick Buy and David Duncan at Arthur Andersen. Fastow explained how he could hedge its Rhythms Net stock with a put option offered by LJM. It was, of course, later approved.

Also today, in 2002, three lovely men referred to here as the Natwest Three, were charged with one count of wire fraud.

Gary Mulgrew, Gilles Darby, and David John Birmingham were all employees of NatWest. They were accused of being involved in a series of financial transactions involving an investment in Enron. The pay off, the Task Force alleged, should have gone to NatWest and not to the men personally.

These three, like the Broadband Three, are great men who did nothing wrong. The legal case of the Natwest Three is fascinating to me because they were pursued under certain of the new terrorism laws that had been put into place after 9/11. They are three British subjects who worked for a British bank – IN BRITAIN – and ended up in a Texas courtroom.

Just another crazy incident in the Enron prosecutions, I guess.

NatWest Three: British Hotties

What is it about men from Britain? They are born with the ability to rock a suit. I’ve never seen any of these guys look anything less than spectacular.

They occasionally wears suits where the print is visible, like so:

Gary Mulgrew looks terrific in that overcoat. They all look terrific. David Bermingham is the Ken Rice of the Natwest Three. He just looks amazing in everything.

Madoff Pleads Guilty: Cara & Friend Discuss

On Tuesday, I received a flash-bang email from the NYT announcing that Madoff was about to plead guilty and would accept a life sentence. I forwarded it to a friend with a note:

If it’s a life sentence, why not go to trial? That way he at least has the hope of a few technicalities that might result in a lower sentence, or even acquittal (though that’s unlikely.)

My friend’s reply thrilled me:

Maybe Madoff is hoping that when he is sentenced, he will get less than the life sentence. Maybe the Feds agreed to recommend something less.

I don’t understand why the only punishment we seem to be able to come up with is prison. Why put non-violent white collar guys into prison? Why not simply make them get a regular job and pay a certain percentage of their earnings out as a penalty?

I have toyed with the idea of sending a proposal to Obama in which I say that I want to hire some white collar prisoners. I get to look at the resumes of all the business executives in all the prisons and choose the ones I want for my new business. I will pay them a market salary, and they must pay a certain percentage back to the government as a penalty. The government must release them from prison for this program. Not only would taxpayers not need to pay for their upkeep in prison, but they would actually be making money and paying taxes (and starting businesses to provide jobs to others). This idea is probably too rational for the Feds.

Wow! Brilliant.

I would like to suggest that our first hire should be Jeff Skilling. Second is the NatWest Three, the Merrill Bankers, Joe Hirko, Rick Causey…

I am completely serious when I say that I would trust any of those guys with my life savings before I would trust the government. Madoff, I’m not so sure – I don’t know the facts of his case – but I do know that my friend is right. There has to be a better solution than prison for white collar guys. They aren’t violent. They are generally well-educated, smart people. If they are guilty, then punish them appropriately. But don’t just throw them into the gulags and forget them.