Posted on 10/26/2002 4:49:23 AM PDT by Libloather
U.S. Wants to Question Ex-Qwest CEO
Fri Oct 25, 7:44 PM ET
By CATHERINE TSAI, AP Business Writer
DENVER (AP) - Congressional investigators plan to interview former Qwest chief executive officer Joe Nacchio again after an interview Friday with company founder Philip Anschutz left unanswered questions about Anschutz's role at Qwest.
Qwest is under investigation by regulators and lawmakers over its accounting practices.
Anschutz, a Qwest director, told House Energy and Commerce Committee staff last month and again Friday he was largely uninvolved in day-to-day operations. Nacchio has told the committee he spoke to Anschutz regularly.
Anschutz did say he had periodic discussions with Nacchio on larger deals, committee spokesman Ken Johnson said. Johnson would not elaborate.
Nacchio's lawyer, Charles Stillman, said through a spokesman Friday that Nacchio has cooperated with investigators since the inquiry began and would consider a request to speak to them again if they ask.
Committee staff are investigating whether Qwest, Global Crossing and others engaged in swap transactions that were designed to artificially inflate revenues.
"Frankly, we still believe that some of Qwest's deals were a little shaky," Johnson said. Another interview with Nacchio will be scheduled in a few weeks, he said.
In September, Qwest announced it was erasing $950 million in revenue booked from swaps.
"We're still troubled by a lot of things," Johnson said. "Anschutz served as chairman of the board. Even if he was sort of an absentee landlord, he cannot simply shrug his shoulders when the pipes in the house break."
A spokesman for Anschutz countered that Anschutz was a non-executive chairman with no special duties relative to other board members. He said the board acted quickly after analysts first questioned Qwest's accounting in June 2001.
Johnson said Anschutz's lawyers stopped the Denver billionaire from answering questions about a lawsuit filed by New York Attorney General Eliot Spitzer last month.
Spitzer alleged Qwest steered underwriting business to Salomon Smith Barney in exchange for giving executives access to IPO shares that often reaped the executives millions of dollars.
Anschutz maintains he never got IPOs through Grubman and that Qwest's board did not select investment banking firms.
WASHINGTON (AP) - Government investigators said Friday they want to find out whether a former Enron Corp. executive improperly hid the company's stake in three California wind power farms.
The Federal Energy Regulatory Commission, which launched the investigation, said it also will hold hearings on whether the three small power producers should lose their licenses to sell wholesale electricity to U.S. utilities.
"If these allegations are true, they conflict in material respects with the representations made by the small power producers," FERC said in its order.
The three Enron-affiliated California wind power farms — Sky River, Victory Garden and Zond Windsystems — were recertified by FERC in June 1997 as qualified to sell wholesale electricity to U.S. utilities, several months after Enron acquired Portland General Electric utility.
As part of that recertification, officials at each farm told FERC that Enron would transfer ownership interests to partnerships not affiliated with Enron. A 1978 federal law requires electric utilities to buy renewable energy from FERC-approved facilities owned by independent power producers.
Under that law, intended to lessen dependence on foreign oil by cutting demand for traditional fossil fuels, FERC designates which facilities qualify and oversees the rates that the producers charge buyers.
In an eight-page order issued Thursday, FERC said that it was following up on "serious allegations" by the Justice Department earlier this month in its criminal case against former Enron chief financial officer Andrew Fastow.
Gordon Andrew, a spokesman for Fastow, said Friday said neither he nor his client would comment on the commission's action.
Prosecutors alleged in federal court in Houston that Fastow and former aide Michael Kopper created two partnerships, known together as RADR, to disguise Enron's interest in the California wind farms through supposedly independent investors.
On the Net: Federal Energy Regulatory Commission: http://www.ferc.gov
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