Hearing held for Qwest's Nacchio

Hearing held for Qwest's Nacchio

	Published : Fri, 01 Jun 2007 00:52 By : Agencies Print this Story

DENVER (AP) - Former Qwest chief Joe Nacchio, convicted of insider trading, would set aside $52 million for a potential judgment against him under a proposal being negotiated with his attorneys, a prosecutor said Thursday.

The agreement is part of the government's efforts to try to ensure the money -- equal to the gross proceeds from his illegal stock sales -- would be available in case the judge requires Nacchio to forfeit it at sentencing.

Prosecutors also asked U.S. District Judge Edward Nottingham to issue a preliminary court order that could help them determine whether Nacchio's wife, Anne Esker, or others have rights to some of Nacchio's assets.

Nottingham agreed to give Nacchio's attorneys a week to respond to the request before he will rule.

Nacchio is scheduled to be sentenced July 27 after he was convicted last month of 19 counts of illegally selling stock when Qwest Communications International Inc. was at financial risk but he didn't tell investors.

Nacchio remains free on bail pending the sentencing.

Each count carries a penalty of up to 10 years in prison and a $1 million fine. Any forfeiture that is ordered would be in addition to the fines. Nacchio plans to appeal his conviction.

At this time, lead prosecutor Cliff Stricklin told Nottingham he did not expect any Qwest shareholders who lost money as a result of Nacchio's actions to testify at the sentencing.

Nacchio originally was charged with 42 counts of insider trading for $101 million worth of transactions between January and May 2001.

A federal jury deliberated six days before concluding Nacchio illegally sold stock in April and May of 2001 when he knew the company relied heavily on one-time sales to meet revenue targets. The jury acquitted him on the other 23 counts.

Separately, Nacchio and several other one-time Qwest executives are still involved in a pending civil fraud lawsuit that accuses them of orchestrating a financial fraud that forced the Denver-based telecommunications company to restate $2.2 billion in revenue.