Qwest's Nacchio Indicted

Former Qwest (Q Quote - Cramer on Q - Stock Picks) chief Joe Nacchio was indicted on 42 counts of insider trading, Reuters reported.

The indictment handed up by the grand jury was read out in federal court by U.S. Magistrate Judge Patricia Coan. Nacchio, who arrived in Denver on Monday from his home in New Jersey, was expected to make his initial court appearance on Tuesday, Reuters said.

A report on Reuters last week said Nacchio could be charged with selling stock whose value was inflated by accounting fraud at the telephone company.

The grand jury investigation is separate from civil proceedings against Nacchio and other executives of Qwest, which was forced to restate earnings for 2000 and 2001 to eliminate about $3 billion in revenue.

Nacchio, who has denied any wrongdoing, left the company in 2002. Six other executives have been charged criminally in the probe.

In November, Qwest agreed to pay $400 million to settle investor lawsuits tied to the aggressive bubble-era accounting practices of previous management led by ex-CEO Nacchio. Last fall, Qwest paid $250 million to settle Securities and Exchange Commission fraud charges.

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