Former Qwest CEO May Face Civil Charges
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DENVER -- The Wall Street Journal is reporting that Qwest Communications&#39; former chief executive could soon face civil charges for his alleged role in an accounting scandal at the company.
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Qwest Chairman and CEO Richard Notebaert, brought in to take over after Joseph Nacchio was indicted for insider trading in 2002, will retire after making the carrier profitable.
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TORONTO -- The U.S. Securities and Exchange Commission on Monday filed civil fraud charges against a former CEO and three other former top executives of Canadian telecom equipment maker Nortel Networks Corp.
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Qwest has been under investigation by the SEC and the Justice Department over allegations that it inflated revenue by incorrectly booking network-capacity deals to meet revenue expectations.
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NEW YORK -- The former controller of WorldCom Inc. testified yesterday that former chief executive Bernard Ebbers apologized to him in 2000 after company accountants were forced to cover up more than $800 million in expenses. David Myers said he encountered Ebbers in October 2000 at the company's Mississippi headquarters, days after he and other accountants had devised a plan ...
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Lucent Technologies, the nation&#39;s biggest telecommunications equipment maker, said yesterday that the Securities and Exchange Commission was considering suing three former executives over possible
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Qwest Communications International Inc. has agreed to pay $250 million to settle financial and disclosure fraud charges, the US Securities and Exchange Commission said Thursday.
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The top three executives of the American Stock Exchange may face civil charges for failing to properly enforce the exchange's rules.
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NEW YORK -- The Securities and Exchange Commission is considering recommending charges against a Citigroup executive whose departure was announced this week, the financial-services giant said Friday.
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(InfoWorld) - Prosecutors are recommending that former Qwest Communications International chief Joseph Nacchio serve more than seven years in prison for insider trading during the telecommunications boom. Nacchio, who was CEO of Qwest from 1997 to 2002, would serve 87 months plus three years' probation, and pay as much as $19 million in fines, under the recommendation filed Friday by federal attorneys. He wasÂ convicted in federal courtÂ in April of 19 counts of insider trading involving $52 million in stock sales. He was cleared on 23 other insider-trading counts. Following the prosecutors' sentence recommendation to Judge Edward Nottingham of the U.S. District Court for the District of Colorado, in Denver, Nacchio's lawyers on Friday asked for a reduction in the recommended sentence. They cited good works by Nacchio and the possible effect of a long sentence for Nacchio on the health of two of his family members. In their filing, the government's attorneys said Nacchio deserved a sentence at the high end of the scale because of brazen lies to investors, the size of his ill-gotten gains, and other factors. He faces a maximum possible sentence of 10 years in prison and a $1 million fine for each count, plus a forfeiture of assets. Qwest is a regional incumbent telecommunications provider that serves several states in the West and Midwest. Nacchio resigned in 2002 amid concerns from shareholders about his $27 million annual compensation package. In 2005, the U.S. Securities and Exchange Commission charged him and other Qwest executives with fraud, saying they misrepresented one-time sales of network capacity as recurring revenue in order to boost the company's stock price. Nacchio unloaded his own stock while predicting strong growth, all the while knowing about problems with Qwest's performance, the government charged.
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LOS ANGELES - A former executive at mortgage lender Countrywide Financial Corp. was charged yesterday with insider trading after he sold stock before the company disclosed negative earning results three years ago, regulators said.
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(InfoWorld) - A civil lawsuit accusing Henry Nicholas III, the former president and CEO of Broadcom Corp., of mistreating employees, using illegal drugs and paying for prostitutes, has reportedly caught the attention of U.S. law enforcement officials investigating stock options backdating at the company. Nicholas, who resigned from Broadcom in January 2003, is the target of a civil lawsuit brought by cousins Kenji and Scott Kato, both former employees of Nicholas. The lawsuit, filed in November in Superior Court of California for the County of Los Angeles, alleges that Nicholas and his lawyers reneged on a settlement for wrongful termination and other claims. The Wall Street Journal reported Friday that the U.S. Attorney's Office for the Central District of California, which is investigating stock options backdating at Broadcom, has begun looking into the Katos' claims. The U.S. Federal Bureau of Investigation interviewed Kenji Kato in April, and this week, it began interviewing other Nicholas employees, the news report said. Kenji Kato's lawyer, Joseph Kar, declined to comment on the U.S. Attorney's interest in the case. A spokeswoman for the U.S. Attorney's office didn't immediately return a phone call seeking comment on the investigation. Broadcom, a chip maker for communications devices, announced in January it would take a $2.24 billion charge for stock options backdating. Broadcom said it found options for 232.9 million shares of company stock that had been backdated, with 9.7 million of those shares going to executive officers. Kenji Kato, who describes himself in court documents as a former personal assistant of Nicholas', said Nicholas and his lawyers offered him a settlement of more than US$2.9 million in November, then withdrew it. Kato had accused Nicholas of wrongful termination, breach of contract and infliction of emotional distress, among other things. Kenji Kato worked for Nicholas from October 1999 to April 2006, and during much of that time, Nicholas threw wild parties and regularly used illegal drugs such as cocaine, according to a court filing from May. While at Broadcom, Nicholas hired prostitutes for clients and for himself, and he spiked customer drinks with powdered ecstasy pills to lower their "inhibitions and guard," Kato said in the filing. Nicholas' lawyer, Steven Silverstein, didn't immediately return a phone call seeking comment on the lawsuit. But in court documents, Nicholas' lawyers deny the allegations and accuse Kato of attempting to extort money from Nicholas. Kato signed a confidentiality agreement when working for Nicholas, according to documents filed by Level 7 LLC and The Management Company LLC, two companies owned by Nicholas. Kato has threatened to make public "certain sensitive private alleged facts ... which he had expressly promised to keep private," the Level 7 court documents say. "Kato's wrongful conduct by issuing these threats ... will cause great and irreparable injury to plaintiffs." Nicholas regularly yelled at employees, and he demanded that Kenji Kato carry a bag with illegal drugs for him, according to Kenji Kato's filing. Nicholas also demanded that Kato use drugs along with him, Kato said. "I was regularly exposed to ... a high degree of debauchery while working for Nick," he said in his filing. "The first time I used cocaine was when Nick shoved a tiny spoon up my nose because I was falling asleep, while he was talking to me. Over time, I got sucked into his extreme lifestyle." By the end of Kato's employment, Nicholas was using "large quantities" of illegal drugs, including cocaine and heroin, and had withdrawn from his friends and family, according to Kato's May filing. Nicholas had stopped paying Kato, although he still demanded work from him, and when Kato walked out, Nicholas owed him $150,000 in back pay, the court documents say. Nicholas had promised Kato employee benefits and Broadcom stock options, but he never delivered, according to Kato's filing.
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Federal prosecutors are strongly  considering criminal charges against former executives of  Broadcom Corp., Apple Inc., and KLA-Tencor Corp., related to  the backdating of stock options, the Wall Street Journal  reported on Friday, citing people familiar with the situation.
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The U.S. Securities and Exchange  Commission said on Tuesday it brought civil fraud and insider  trading charges against former top executives of bankrupt  credit card issuer NextCard Inc. NXCD.OB
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The S.E.C. notified the top three executives of the American Stock Exchange that they may face civil charges of failing to properly enforce the exchange's rules.
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Former WorldCom Inc. chief executive Bernard Ebbers has indicated he will seek reimbursement from the company for his millions of dollars in legal bills.
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Federal prosecutors are strongly considering criminal charges against former executives of Broadcom Corp., Apple Inc., and KLA-Tencor Corp., related to the backdating of stock options, the Wall Street Journal reported on Friday, citing people familiar with the situation.