Joe Nacchio probably wouldn’t have been prosecuted by the federal government had he stopped trading shares of Qwest when it became clear to company executives that its 2001 earnings projections were unrealistic.
A University of Denver professor suggests CEOs will always have an inside edge, no matter how much information their companies publicly disclose.
“I’m just wondering if executives should sell any stock at the time that they are at the head of a company,” says Kevin O’Brien, a DU associate professor specializing in corporate governance issuesat the Daniels College of Business. “They should wait until after they leave.”
Nacchio, 57, was convicted Thursday on 19 counts of insider trading involving shares with gross proceeds of about $52 million. The ex-CEO of Qwest faces up to 10 years in prison and a minimum of more than $71 million in fines and forfeitures.
