Szeliga settlement another boost for fund
Investors will get $577,000 if court OKs agreement
By Jeff Smith
Rocky Mountain News
Wednesday, May 16, 2007
It's not a lot in the scheme of things, but a Qwest investors
restitution fund has been boosted by more than $3 million as a
result of settlements between the federal government and former
Qwest executives. Most recently, former Qwest Chief Financial
Officer Robin Szeliga agreed to pay more than $577,000 to settle
civil fraud charges with the Securities and Exchange
Commission. The agreement still must be approved by the court.
According to court filings, Szeliga previously paid $125,000 of
restitution and $5,547 in interest into the investor
distribution fund in connection with pleading guilty to one
felony count of insider trading.
Gregory Casey, who once headed Qwest's wholesale division, paid
$2.1 million into the investors fund as part of settling civil
fraud charges with the SEC in 2005.
Other payments into the fund by former Qwest executives who have
settled SEC charges include: Augie Cruciotti, $350,000; Roger
Hoaglund, $300,000; and William Eveleth, $105,575, according to
Szeliga's $577,052 settlement includes forfeiting $226,135 of
profits, or "ill-gotten gains," $100,917 of interest from her
profits, and a $250,000 civil penalty.
She will be prohibited from paying the penalty out of her
executive indemnification insurance with Qwest.
"It wouldn't serve as a penalty if she gets reimbursed," said
SEC assistant regional director Mary Brady.
More money may eventually come into the investors fund as SEC
civil fraud lawsuits remain pending against former Qwest CEO Joe
Nacchio, former Chief Operating Officer Afshin Mohebbi, former
Chief Financial Officer Robert Woodruff, and former accountants
Frank Noyes and James Kozlowski.
The SEC wants $216 million from Nacchio, $41 million from
Woodruff and $5.9 million from Mohebbi. Claims against Nacchio
have been strengthened in the wake of his conviction last month
on 19 insider-trading charges.
But the SEC requested $34.9 million from Casey and wound up
settling for a fraction.
More than $3 million in a Qwest investor victims fund comes from
federal settlements with former executives:
• Former CFO Robin Szeliga: $125,547 (criminal
insider trading plea), $577,000 from a SEC settlement (still
must be approved by court).
• Former EVP/wholesale Gregory Casey: $2.1
million (SEC settlement).
• Former EVP/network operations Augie Cruciotti:
$350,000 (SEC settlement).
• Former SVP Roger Hoaglund: $300,000 (SEC
• Former SVP William Eveleth: $105,575 (SEC
Source: Court filings
smithje@RockyMountainews.com or 303-954-5155
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