AUSWR
The Association of U S West Retirees
 

 

 

Feds call Nacchio assets elusive
Funds in wife's name
By Greg Griffin, Staff Writer
Denver Post
Tuesday, May 22, 2007

Federal authorities say they don't know where Joe Nacchio is keeping the $52 million he earned making illegal trades in 2001.

Officials have been able to track the money to bank accounts in the name of Nacchio's wife through 2005, but no further.  The former Qwest chief executive and wife Anne Esker used some of the money to buy a $9.5 million home in Florida, the government said.

"The United States does not know the location of all of Mr. Nacchio's assets, or the location of the assets of his wife, and any family trusts and foundations," prosecutors said in a court filing on Friday.

The threat of jail time is likely to compel Nacchio to cooperate with authorities when it comes to forfeiture of assets, said Tony Leffert, a Denver defense attorney.

"Most likely, what will happen is they will work out some kind of deal, and Nacchio will write a check" that could be deposited in an escrow account until his sentencing on July 27.

Nacchio collected more than $250 million in stock sales, bonuses and salary during his tenure at Qwest from 1997 to June 2002, and much of that money is targeted in civil cases.

The Securities and Exchange Commission is seeking $216 million.

Attorneys representing shareholders have sued Nacchio, saying he oversaw an accounting fraud scheme at Qwest and sold $213 million in stock.

Nacchio has denied the allegations in both cases.  A hearing is scheduled Thursday in the SEC case in federal court in Denver.

Prosecutors said in their Friday filing that Nacchio transferred $133 million to Esker in 2002 as he faced civil lawsuits and government investigations.  His financial adviser said in notes provided by prosecutors that Nacchio intended to protect his assets against creditors, and at one point, he considered divorcing Esker for the same purpose.

The government is seeking to have Nacchio's assets frozen and is asking for an itemized asset list from Nacchio.

Staff writer Greg Griffin can be reached at 303-954-1241 or ggriffin@denverpost.com.

http://www.denverpost.com/business/ci_5952346