Former Qwest CEO heads to jail
The outspoken former head of Qwest, who executed a bold merger between the broadband service provider and a local telephone company, reported to prison on Tuesday.
Joseph Nacchio's last-ditch attempt to avoid jail failed when U.S. Supreme Court Justice Stephen Breyer denied his application for bail and a temporary stay. That means he'll await his appeal from prison.
Nacchio reported to prison at the Schuylkill Satellite Camp in Minersville, Pennsylvania, on Tuesday morning, the U.S. Department of Justice said.
It's barely a year since a jury found Nacchio guilty of 19 counts of insider trading and sentenced him to six years in prison. They found that while he was publicly forecasting strong growth for Qwest as CEO in 2001, he was selling off his own stock in the company because he knew it was struggling.
The merger of Qwest and US West was a difficult one that required lengthy dealings with state and federal governments because it involved a local phone company. Nacchio and Sol Trujillo, then CEO of US West, sometimes butted heads publicly as closing the deal dragged on.
Nacchio was also unpopular with some employees. He laid off thousands of workers after the merger and sometimes repeated the "U.S. worst" nickname for US West, angering people who had worked for the local phone company for many years.
Nacchio was replaced as CEO in 2002 as the company struggled under a crippling debt load and a U.S. Securities and Exchange Commission investigation into its accounting practices.