AUSWR
The Association of U S West Retirees
 

 

 

'He committed no crimes'
Ex-Qwest exec was never asked to make plea deal, lawyer says
By Jeff Smith
Rocky Mountain News
Tuesday, December 6, 2005

The attorney of former Qwest President Afshin Mohebbi said Monday that federal prosecutors never tried to get his client to accept a plea bargain.  "He was never asked to plead guilty to a criminal charge," New York attorney Paul Grand said.  "And he would not have because he committed no crimes."

Jeff Dorschner, spokesman for the U.S. Attorney's Office in Colorado, declined to comment.

Mohebbi, who has been granted immunity in the case, former Chief Financial Officer Robin Szeliga and Qwest's former chief legal counsel Drake Tempest are emerging as possible key witnesses against former CEO Joe Nacchio should the latter be indicted for insider trading.

Reuters reported late Friday that Mohebbi and Tempest recently testified in front of a federal grand jury, but Grand declined to comment on the report.  Tempest's attorney didn't return a phone call Monday.

Many experts thought Mohebbi, who faces civil fraud charges, would be in the clear criminally because he didn't benefit from stock sales.

Federal prosecutors appeared poised to seek an indictment against Nacchio on insider trading charges three weeks ago, according to several sources familiar with the investigation.  But, with the grand jury meeting at least one more time this month, an indictment still could come before year's end.

There could be a number of reasons for a delay, from prosecutors wanting to wrap up loose ends and finalize agreements with key witnesses, to grand jurors being absent or having questions, to prosecutors evaluating defense strategies.

The Wall Street Journal reported recently that Nacchio's legal team was pursuing a national-security defense strategy that could pose evidence issues for the prosecution and judge.

The timing of a possible Nacchio indictment has been linked to the fact that the U.S. Attorney's Office in Colorado has been granted only until year-end a freeze on civil fraud proceedings against Nacchio.  But a hearing on that deadline tentatively isn't scheduled to take place until mid-January.  Five-year statute of limitation risks don't appear to be an issue until next spring.

Federal prosecutors are thought to be focusing on when Nacchio sold nearly $50 million of Qwest stock in a three-week period after Qwest's first-quarter earnings were announced on April 24, 2001.

Szeliga, who already has pleaded guilty to insider trading, said in her plea agreement that other senior executives knew by that date that Qwest was beefing up its numbers through questionable and undisclosed one-time deals.

http://rockymountainnews.com/drmn/other_business/article/0,2777,DRMN_23916_4292459,00.html