DENVER—A judge ordered Joe Nacchio on Thursday to deposit $19 million—the amount Nacchio was fined for his insider trading conviction—into a court account to be held pending the outcome of the former Qwest chief executive’s appeal.
U.S. District Judge Edward Nottingham said the money will be kept in a U.S. District Court interest-bearing account until the appeal is settled.
Nottingham last month sentenced Nacchio to six years in prison, the $19 million fine and forfeiture of $52 million in assets after Nacchio was convicted on 19 counts of insider trading.
A federal jury found in April that Nacchio sold $52 million of stock in April and May of 2001 while withholding from investors information that Qwest Communications International Inc., a Denver-based telecom, faced financial risk.
Nottingham issued Thursday’s order at the request of defense attorneys, who said Nacchio will deposit the check on or before Aug. 27.
Nottingham has ordered Nacchio to begin serving his prison term 15 days after the U.S. Bureau of Prisons designates a facility for him, a process that typically takes 30 to 45 days.
The judge rejected Nacchio’s request to remain free on bail pending appeal, a decision that Nacchio has appealed.
His attorneys have said there are several issues to be raised on appeal, including improper jury instructions, the exclusion of a defense witness’ testimony and Nottingham’s decisions regarding classified information about Qwest’s business dealings with the government.
In a related case, Nacchio and four other ex-executives of Qwest Communications International Inc. are named in a civil fraud lawsuit filed by the Securities and Exchange Commission.
Regulators say Qwest falsely reported fiber-optic network capacity sales as recurring instead of one-time revenue between April 1999 and March 2002.
The SEC case is not expected to be set for trial until 2009.
