Ii'. U UNITED STATES DISTRICT COURT SOUTHERN DISTRICT COURT OF TEXAS HOUSTON DIVISION Case No. I{-03-CR-150 DECLARATION OF ANI)REW S. FASTOW IN SUPPORT OF LEA FASTOW'S MOTION TO SCHEDULE TRIAL TO OBTAIN EXCULPATORY T)~STXONY FILE)) EX PA~TE. UNDER SEAL I, A1~DREW S. FASTOW, declare under penalty of peijury, as follows: 1. I am making this declaration for the limited puxpose of and only in connection with the particular proceeding of my wife's Motion to Schedule Trial to Obtain Exculpatozy Testimony. I have been advised by my counsel that by making this declaration, I do not waive any rights, including my Fifth Amendment rights and my attorney-client privilege, and I reserve the right to assert those rights and any other rights at any other time as to the matters covered in this declaration. 2. 1 am the husband of Lea Fastow, the defendant in the above captioned matter. We have been a couple for over 22 years, and I have been married to her for 18 years. We have two children. 3. On October 31, 2002, the government obtained a 78-count indictment against me ~ - charging me in connection with various complex structured finance transactions at Enron Corp. in 1997 - 2001. On April 30, 2003, the government flied a 109 count superceding indic1~ent UNITED STATES OF AMERICA, Plaintiff; V. LEA W. FASTOW, Defendant. GOVERNMENT EXHIBIT 7601 CrimNo H-04-0025 P. U~ "A.J .~LJIQ L~~L 0 *~UU~ ~ Lx Parte~ Under Seal against tue concerning these same matters. Both indictments charge that I played a central role in various allegedly Eraudulent transactions including RAflR and Chewoc. 4. I am preparing for ixiai. eased on advice of counsel and the Fifth Amendment, I will decline to testify before my own trial. My case is set for a status conference before United States District Judge Kenneth Hoyt on July 28, 2003. 5. If Lea Fastow's trial were held after the completion of my trial, I would not invoke the Fifth Amendment, and I would testify at her trial, as set forth below. 6. I never, and to my knowledge and belief Michael iKopper never, agreed or conspired with Lea Fastow to commit the crimes alleged in Counts 1 and 2 of Lea's indictment. 7. The indictment against Lea alleges in Paragraph 11 that payments totaling $67, 224 received by our family from Michael Kopper were a "kickback" from Chewco which should have been reported on our tax returns. I would testify that Lea and I discussed our belief that these payments were paid to us voluntarily and out of friendship, and therefore were not taxable income. 4 8. The indictment against Lea Fastow alleges in Paragraph 13 that money our family ~. received from Michael Kopper and Bill Dodson was in fact RADR income "disg~ised" as "either interest from an unspecified loan to Kopper or gifts," and was paid to "foster the illusion" that they were gifts which would not require reporting to the Internal Revenue Service. If called as a witness, I would testily that: a. Lea and I discussed the fact that $62,850 paid to us in August, 1997 was interest required to be paid to us under the tenus of a loan agreenent and as such was taxable income, and we therefore reported it on our tax returns; 2 a ~Uu~ H. U3 Ex Parte~ Under Seal 1,. Lea and I discussed the fact that other payments of money Lea and I and our sons Jeffrey and Matthew received from Michael Kopper and Bill Dodson were payments given to us voluntarily and out of friendship, and therefore were not tax~b1e income. c. As a general matter, Lea and I frequently discussed and agreed on oux desire and duty to fully report all taxable income. d. Based on my discussions with Lea, I am confident that she honestly believed that the payments we received from Kopper and Dodson were non-taxable, and that she therefore believed that our tax returns for 1997, 1998, 1999 and 2000 were in fact true and correct as to every material matter, contrary to the charges in Counts 3-6 of Lea's indictment. 9. I would also testify at Lea's trial that Michael Kopper told me that these various payments were gifts to us, and I related Kopper's statements to Lea. Both Lea and I understood that gifts were not taxable. DATE: ~-' 03 FAS2~ A~1JREW S. Si~ed and sworn before me on May ~,7oi# 2003. NiBtary Public in for the State of Texas 3 .4-