FOR IMMEDIATE RELEASE
July 14, 2005
FORMER QWEST CHIEF FINANCIAL OFFICER PLEADS GUILTY TO INSIDER TRADING
DENVER - The United States Department of Justice, the Federal Bureau of Investigation, and the U.S. Postal Inspection Service announced that ROBIN SZELIGA , age 44, of Littleton, Colorado, pled guilty this morning before U.S. District Court Judge Walker D. Miller to one count of insider trading. Judge Miller is scheduled to sentence SZELIGA on November 4, 2005 at 1:30 p.m. SZELIGA was charged by way of Criminal Information with one count of insider trading on June 2, 2005. She remains free on bond.
According to the stipulated facts outlined in the plea agreement, SZELIGA was Qwest's Chief Financial Officer (CFO). On April 30, 2001, while in possession of material, non-public information regarding Qwest's true operating performance and financial condition, SZELIGA sold 10,000 shares of Qwest stock at $41 per share, obtaining gross proceeds of approximately $410,000, with a pre-tax gain of $125,000. SZELIGA has agreed to pay $125,000 in restitution to the SEC's victim fund.
During 2001 and at other relevant times, the defendant was in possession of material, non-public information regarding Qwest's true and actual operating performance and financial condition, obtained through, among other sources, internal documents and conversations and meetings with other executives. Part of this non-public information included the quality, nature, source and growth of Qwest's revenue, which information the defendant knew and believed was important to the investing public.
The defendant knew that the various Qwest business units were not going to meet revenue targets and expectations for the first and second quarters of 2001 as portrayed to the investing public. The defendant further knew that Qwest was ultimately only able to meet its announced 2001 first and second quarter earnings expectations through the certain revenue sources, which Qwest classified as "non-recurring" and which were used as publicly undisclosed "gap-fillers" to meet revenue targets. SZELIGA pled guilty to selling Qwest stock knowing the true, complete and accurate information regarding the company's financial condition.
The QWEST investigation is being conducted by the Federal Bureau of Investigation (FBI) and the U.S. Postal Inspection Service. The case is being prosecuted by Acting United States Attorney Bill Leone and Department of Justice Fraud Section Trial Attorney Michael Koenig.
SZELIGA faces not more than 10 years in federal prison, and/or up to a $1,000,000 fine. The actual sentence will be determined by U.S. District Court Judge Walker Miller.