Gary Mulgrew and Giles Darby were managing directors and David Bermingham was head of structuring at GNW, a division of the bank with offices in Greenwich, Connecticut, and London. While negotiating on behalf of NatWest, the three are said to have executed a scheme to get the bank to sell its interest in a company, Campsie, for $1 million knowing it was worth far more. They were allegedly helped by Enron associates. Campsie and a company called ERNB were limited partners in the newly formed LJM Cayman, which hedged risk for Enron.

At the same time, the three allegedly obtained a portion of NatWest’s interest for $250,000. They liquidated it weeks later for $7.3 million in personal profit, the FBI claims.

Meanwhile, NatWest had an interest in a company, Swap Sub, whose main assets were Enron shares. In early 2000, as the Royal Bank of Scotland was making a takeover of NatWest, these Enron shares were increasing in value. The three are said to have pursued and discussed efforts to enrich themselves from the liquidation of NatWest’s interest in Swap Sub.

January 29 2000: Mr Bermingham e-mailed Mr Darby that, with Enron shares high, NatWest’s interest in Swap Sub had significant value. “The trick will be in capturing it. I have a couple of ideas but it may be good if I don't share them with anyone until we know our fate!!!” The FBI believes the three were looking for ways they could capture the value of NatWest’s interest in Swap Sub for themselves.

February 19 2000: Mr Bermingham e-mailed Mr Mulgrew and Mr Darby about an upcoming presentation to Andrew Fastow, chief financial officer of Enron, concerning a proposal to restructure Swap Sub. Mr Fastow also acted as general partner in LJM Cayman. Mr Bermingham wrote “the story looks compelling, and even Andy would have trouble arguing that the benefit split is anything other than equitable. For your info, our minimum profit per these slides would be $8m, rising to $17m for the middle bit, and then finally up to around $30m. Everybody wins . . . Even the LPs don’t end up looking too shabby.” The FBI believes the “LPs” are the limited partners Campsie and ERNB.

February 20 2000: Around this time Mr Bermingham e-mailed Mr Mulgrew that the proposal he had drafted did not guarantee Mr Fastow a profit of $25m. Mr Mulgrew replied “why can’t you squeeze the LPs a bit more”.

February 21, 2000: About now, Mr Bermingham forwarded a message to Mr Mulgrew and Mr Darby that he had already sent to another NatWest employee in GNW’s structured finance group. Mr Bermingham added the message: “This is an attempt to head the obvious off at the pass and keep the lid on the thing.” The forwarded message stated that Mr Darby and Mr Mulgrew were going to Houston to do a deal and that their boss was “in the loop”, but that the other employee should “not speak to anyone” and should "just act dumb please.”

February 22, 2000: Around this date the three travelled to Houston, Texas, to make a presentation to Mr Fastow. Mr Darby told Nat West’s relationship manager in Houston not to attend but also not to worry because they were “going to get rich”. The presentation discussed various alternatives which appear to be detrimental to NatWest’s interest as a limited partner in LJM Cayman. One of the possible alternatives listed in the presentation was to sell the Enron stock held by Swap Sub for cash and then buy it back a few days later. This appears to have been an attempt to convert that stock from “partnership property”, which Mr Fastow was contractually prohibited from using for profit, to “substitute property”, which Mr Fastow could profit from. However, the presentation went on to note: “Problem is that it is too obvious (to both Enron and LPs) what is happening (ie, robbery of LPs), so probably not attractive. Also no certainty of making money”.

February 26 2000: Mr Bermingham e-mailed Mr Mulgrew addressing the potential tax consequences of the proposed transactions. He wrote: “we know the minimum profit of CayCo will be $7m”.

The FBI believes CayCo refers to Southampton K Co, the vehicle used to facilitate the three’s effort to obtain the majority of NatWest’s interest in Swap Sub. Mr Mulgrew replied: “I understand (its so much easier to focus when its your own dough).”

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