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Three British former NatWest bankers who admitted to fraud in return for reduced prison sentences in the US have had their plea bargain formally approved by a judge.

Giles Darby, David Bermingham and Gary Mulgrew each pleaded guilty to one count of wire fraud in November as part of a deal with US prosecutors that will see them each serve three years and one month behind bars.

They were accused of advising Greenwich Natwest to sell a stake in a small Cayman Islands company for a fraction of its real market value to Andrew Fastow, the former chief financial officer of Enron.

The stake was then sold to Enron for its true value and Mr Fastow shared the profits with the trio, who were said to have made about $2.4 million each.

Greenwich Natwest, an investment banking arm of Natwest, is now owned by Royal Bank of Scotland (RBS).

As part of the plea bargain the three former bankers, who were extradited to the US in 2006, have agreed to pay RBS $7.3 million.

Today the three were called before District Judge Ewing Werlein in the Southern District of Texas Court in Houston, who approved the agreement signed with the US Department of Justice.

The plea bargain included an agreement that the three could request to serve some of their sentence in the UK.

The men told the court they wanted to report to Allenwood Prison in Pennsylvania as this is near to where any future transfer back to the UK would take place. The judge accepted a motion which will allow each of the three men to surrender to prison voluntarily and no date for their reporting to jail was set.

Mr Bermingham told the court: “My conduct in this matter fell well below the standards expected.” He said he wanted to apologise to his wife and children, and to the people who suffered from the consequences of his actions.

Mr Darby said: “Clearly a long time has passed since this offence. At the time I didn’t realise the implications of what was happening. I failed to take the right course of action and I deeply regret that.”

He added the consequences of his actions had been “far-reaching in terms of our careers and our reputations”.

Mr Mulgrew said: “First of all, I would like to apologise unreservedly for my actions." He said they “lacked integrity” and apologised to those who had been “hurt” by what had been done.

The three were each originally charged with seven counts of wire fraud – illegally gaining money through international banking systems – that left them facing maximum prison sentences of 35 years.

After protesting their innocence for five years and preparing for a trial, they signed a plea-bargain in November.

The trio gained notoriety in 2004 as the most prominent target of a new extradition treaty between Britain and the US, which allowed America to extradite criminal suspects from the UK without prima facie evidence.

The treaty was signed by David Blunkett in 2003 and came into effect in 2004. The treaty – and the ruling in September 2004 that the NatWest Three’s extradition should go ahead – was greeted with protests from British politicians, business people and human rights campaigners.

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