Ex-Qwest CEO Faces Seven Years in Prison
Federal prosecutors recommended July 6 that former Qwest Communications International CEO Joseph Nacchio serve more than seven years in prison and pay up to $19 million in fines. In April a jury found Nacchio guilty of insider trading for selling $52 million in stock when Qwest faced financial crisis--all the...
July 11, 2007 at 01:04 PM
2 minute read
The original version of this story was published on Law.com
Federal prosecutors recommended July 6 that former Qwest Communications International CEO Joseph Nacchio serve more than seven years in prison and pay up to $19 million in fines. In April a jury found Nacchio guilty of insider trading for selling $52 million in stock when Qwest faced financial crisis–all the while telling shareholders the company's profits were growing.
In the sentencing recommendation filed in U.S. District Court in Denver, prosecutors advised the court to sentence Nacchio to serve 87 months plus three years probation in addition to the fines. The severe punishment, prosecutors said, is deserved because of the size of Nacchio's illegal profit and his brazen lies to shareholders.
Nacchio's lawyers asked the court for a reduced sentence, citing Nacchio's good citizenship and the effects of his imprisonment on two of Nacchio's ailing family members.
Nacchio was CEO of Qwest from 1997 to 2002, when he resigned in the face of shareholder concern over his $27 million annual compensation package. He was indicted on 42 counts of securities fraud and insider trading in 2005 for selling $100 million of stock when he knew Qwest was underperforming. The jury found him guilty on 19 of those counts and cleared him on 23 others.
Prosecutor James Hearty wrote in the sentencing brief, “Any less severe sentence would fail to promote respect for the law, and to protect the public.”
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