Qwest’s Nacchio Guilty of Insider Trading

Former Qwest Communications International Inc. Chief Executive Joseph Nacchio was found guilty in Denver Thursday of 19 counts of insider trading.

A U.S. District Court jury found Nacchio not guilty on 23 of 42 insider-trading counts related to his sale of more than $100 million worth of Qwest stock in 2001.

Nacchio, 57, could face 10 years in prison for each guilty count. Each count also carries a potential fine of $1 million, plus restitution.

Nacchio is free until sentencing, tentatively scheduled for late July.

His lawyer, Herbert Stern, said Nacchio would appeal the verdict, The Denver Post reported.

The charges stemmed from a government investigation into an accounting scandal at the telephone service provider based in Denver.

Federal prosecutors contended Nacchio dumped $100.8 million in Qwest stock during the first five months of 2001 because he knew Qwest’s financial troubles were mounting — even as he issued optimistic guidance to analysts.

Defense lawyers argued Nacchio did not say anything because he believed Qwest would soon receive several large government contracts that could have offset company woes. They also said he sold his stock at a pace consistent with his stock sales during previous years.