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Ex-Qwest CEO To Be Sentenced In July

Former Qwest Communications CEO Joseph Nacchio is scheduled to be sentenced in July after being found guilty on 19 of 42 counts of insider trading.
DENVER — Former Qwest Communications CEO Joseph Nacchio is scheduled to be sentenced on July 27 after being found guilty Thursday (April 19) on 19 of 42 counts of insider trading. The convictions carry a maximum penalty of ten years in prison and $1 million in fines for each of the 19 counts.

Nacchio is free on a $2 million bond, pending an appeal.

A jury of eight men and four women reached their verdicts after six days of deliberation. The convictions came despite what legal analysts said was a weak federal case against Nacchio. The jury found Nacchio guilty on a critical count involving a specific stock sale on April 26, 2001.

The early 2001 stock sales occurred, prosecutors alledged, when Nacchio should have known that Qwest revenues were based on one-time sales of fiber capacity. A federal probe found that Qwest falsely reported the sales as recurring revenue between April 1999 and March 2002.

As a result, Qwest improperly reported $3 billion in revenue. The revenue played a role in Qwest's acquisition of US West Inc.

Nacchio also faces a civil suit in connection with the insider-trading case.

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