The Justice Department saw its five-year investigation of former corporate executives end on a high note with the conviction of one-time Qwest Chief Executive Joe Nacchio. Nacchio joined the likes of Enron’s Jeffrey Skilling and Worldcom’s Bernard Ebbers as he was found guilty on 19 of 42 counts of illegal insider trading.
Collecting over $250 million in stock sales, salary and bonuses throughout his tenure at Qwest, Nacchio was accused of dumping upwards of $100 million in company stock within the first half of 2001 – a time when he was well aware of the company’s ailing financial status. Following Nacchio’s departure from the company, Qwest nearly faced bankruptcy as stock prices hit a record low of $1.11.
Commentary: We spoke with former senior compliance executives at Qwest and asked them what they thought of Nacchio. Their response? “It could not have happened to a nicer guy.” NOT – supposedly he was incredibly arrogant as well as disrespectful to employees.
The best media coverage of the trial was certainly done by the local Denver Post. It was extremely thorough, as seen in this final piece announcing the conviction.
On a side note, most US Attorneys should be happy that they went to law school as they do not have a future as stand-up comedians. Our favorite example for today was the US Attorney for Colorado, Troy Eid, quipping about the conviction: “For anybody who has ever made a call from Qwest’s 14-state service area, ‘convicted felon Joe Nacchio’ has a nice ring to it.” We bet he laid awake at night thinking that one up!
