AUSWR
The Association of U S West Retirees
 

 

 

Feds:  Nacchio wise to woes
Prosecutors allege in a court filing that the Qwest ex-CEO knew of fiscal ills as early as January 2000. 
By Greg Griffin, Staff Writer
Denver Post
Tuesday, April 11, 2006

Former Qwest chief executive Joe Nacchio knew by January 2000 that the company was missing its operating-revenue targets and filling the gap with one-time network-capacity sales, prosecutors said Monday.

Also, in August 2000, just weeks after Qwest completed its merger with US West, Nacchio was advised of "numerous risks with respect to Qwest's 2001 financial targets," the government said in a filing in federal court.

The U.S. attorney's office charged Nacchio in December with 42 criminal counts of insider trading.  Prosecutors allege Nacchio sold $100.8 million in Qwest shares from January to May 2001 when he knew, but did not disclose to the public, that Qwest's finances were deteriorating rapidly.

A trial could be scheduled as early as this fall.

Nacchio has denied the criminal allegations and asked the judge to dismiss the charges.  He is free on $2 million bond.

A call late Monday to Nacchio's attorney, John Richilano, was not immediately returned.

Nacchio left Qwest under pressure from the board of directors in June 2002 and was replaced by current CEO Richard Notebaert.  The company has restated $2.5 billion in revenues for 2000 and 2001.

In earlier filings, the government has said Nacchio knew by August 2000 that Qwest was at risk of missing its financial targets.  The new date indicating when he allegedly knew of Qwest's revenue problems came in a document filed by the government in response to a request by U.S. District Judge Edward Nottingham for more details on the allegations.

Staff writer Greg Griffin can be reached at 303-820-1241 or ggriffin@denverpost.com.

http://www.denverpost.com/business/ci_3696229