A federal judge sentenced former Enron Broadband Services [JURIST news archive] executive Rex Shelby [Houston Chronicle profile] to two years probation Monday on charges of insider trading. The sentencing marks the end of an eight-year long criminal prosecution of Enron executives linked to investment fraud that caused the fall of Enron Broadband unit. Shelby was one of seven executives indicted in 2003 on more than 164 criminal counts for allegedly overstating the value of the broadband division's software and network to inflate the value of Enron's stock. Shelby, who once faced 10 years in prison, was sentenced to serving six months in confinement. As part of his plea bargain, Shelby must forfeit over two million dollars. The judge also sentenced him to nearly 250 hours of community service. Shelby is expected to start his confinement in about a week.
Several trials and appeals have delayed criminal prosecution of Enron executives over the years. Of all the those indicted, three received prison sentences, and two, including Shelby, have been given probation sentences. One executive was acquitted when his charges were dismissed at trial. In 2008, a judge ordered [JURIST report] that three of Enron's CEO's be retried after an appeals court refused to dismiss charges [JURIST report] against the men. In 2006, the US Court of Appeals for the Fifth Circuit [official website] reversed the convictions [JURIST report] of four former Merrill Lynch [corporate website] executives found guilty in connection with an Enron. All of the Enron defendants were acquitted on various charges in 2005, but the jury failed to reach a verdict on all counts, and prosecutors later re-indicted [JURIST reports] the defendants.