Dynegy ex-accountant gets 24 years

By Andrew Walker
BBC World Service economics correspondent

Dynegy is a Texas-based energy firm

Dynegy was one of a number of US companies where accounting problems came to light following the spectacular collapse of the energy giant, Enron, in late 2001.

One common theme in these events was published accounts that misrepresented the true state of the company's finances, making them appear stronger and more profitable than they really were.

In the process, creditors, shareholders and potential investors were misled, and many say they lost money as a result.

In the case of Dynegy, a Texas energy business, an accountant, Jamie Olis, has been found to have recorded what was in fact a loan of $300m as if it were company income.

On Thursday, that offence earned him a 24-year prison sentence.

His lawyer, David Gerger, says the sentence is out of all proportion to the crime.

Stiff penalty

"It's a horrific sentence," he said.

"Today a witch-hunt netted the government a very small fish. Jamie did not enrich himself, he's never been in trouble, he's a young man starting a family, and his boss knew and approved what he did.

"If this can happen to Jamie, it can happen to anyone."

Mr Olis is among the first of several dozen executives charged with involvement in the post-Enron wave of accounting scandals to be sentenced.

The severity of the penalty handed out to him has been seen as a sign that the US courts are taking a tougher line on improper accounting.

Meanwhile in New York, two leading businessmen await the jury's verdict in another trial about alleged financial malpractice.

In this case, it's not accounting problems, but allegations that two top executives took $600m from the industrial group Tyco.

The former chairman, Dennis Kozlowski, and top financial officer, Mark Schwartz, deny the charges.

The court has heard stories of lavish spending, particularly by Mr Kozlowski, including $2m on a birthday party for his wife.

The proceedings are over and the jury is considering the evidence.

But there are reports that relations between the jurors have deteriorated so badly that it's proving hard for them to agree a verdict.