Federal regulators recently stated that a former executive Gregory Casey of Qwest Communications International Inc. has agreed to pay $2.1 million to settle civil charges that he participated in a accounting fraud conspiracy that forced the company to restate billions in revenue.
Casey also agreed to cooperate with the Securities and Exchange Commission's (SEC) investigation into accounting irregularities at the company. He did not admit any wrongdoing. The agreement also prohibits Casey from acting as an officer or director of a public company for five years.
Casey was accused of backdating contracts to allow Qwest to immediately recognize revenue it was to receive later. He earned $34.9 million from Qwest from 1999 to 2001, mostly by exercising stock options, according to the SEC lawsuit.
The SEC has said the fraud at Qwest occurred between April 1999 and March 2002 and allowed it to improperly report $3 billion in revenue that helped clear the way for its acquisition of the phone company U S West in 2000. The revenue was later restated.
Casey was one of seven ex-Qwest executives, including former CEO Joseph Nacchio, charged in a civil lawsuit alleging accounting schemes that later forced the company to restate revenue. Nacchio has denied any wrongdoing. His case is still pending.
Qwest agreed last year to pay $250 million to settle SEC fraud charges.
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