-Caveat Lector- >From http://www.guardian.co.uk/business/story/0,3604,766613,00.html
Tycoon cashed in on Qwest New Dome chief made $1.5bn through share sales while firm overstated revenues David Teather in New York Wednesday July 31, 2002 The Guardian Philip Anschutz, the US entertainment tycoon who plans to revamp the Millennium Dome, made almost $1.5bn (�960,000) from selling shares in Qwest Communications during the time the company now admits it was inflating revenues. Mr Anschutz, 62, cashed the shares in the telecoms company he founded near the market peak in May 1999. The disclosure will further anger the thousands of workers in the telecoms sector who have lost their jobs and investors that have lost billions of dollars as the sector crashed to earth. It will also give ammunition to critics of the way the contract to manage the Dome has been handed out. In addition, other Qwest executives made about $500m between 1999 and 2001, the period under question, according to Thomson Financial. Qwest said this week that the com pany had overstated revenues and underestimated costs by at least $1.16bn over the three years. Joseph Nacchio, the company's chief executive who was forced to resign last month, made $226.7m. The justice department and the securities and exchange commission are investigating the accounting methods used by Qwest. Mr Anschutz was unavailable for comment. A member of staff at his Denver-based investment company said contact with the media was "actively discouraged". Mr Anschutz made his money in oil and has built a broad spread of interests in entertainment, telecoms, real estate, transportation and sport. He signed a deal in May to transform the derided Dome into a world class sport and leisure arena. His company, Anschutz Entertainment Group, has agreed to lease the building from Meridian Delta, a property consortium. Lord Falconer, the minister in charge of the Dome's future, at the time insisted the government had done its "due diligence" on the parties involved. Qwest said the share options were awarded as part of approved compensation packages and often partially sold by individuals to diversify their investment portfolios. The disclosure came as a Senate committee in Washington attacked senior telecoms executives over the level of compensation they received during the boom years and beyond, even as the industry began to crumble. "This strikes many American citizens as patently criminal," senator John McCain said. Executives of Qwest, Global Crossing and WorldCom said they did not expect any disruptions to phone or internet services. Both Global Crossing and WorldCom are already in bankruptcy and investors fear that Qwest, labouring under $26bn of debts, may follow. Last year it reported losses of $4bn. WorldCom chief executive John Sidgmore said: "We are intensely focused on ensuring that all of our customers - consumer, business and government - continue to receive the highest quality without service disruption." Qwest, which is the biggest telephone company in 14 US states, said it would restate its results for the past three years and withdrew its 2002 forecasts. The misreported revenues relate to capacity on its network sold to other telecoms firms, as well as sales of communications equipment. The SEC and criminal investigations are scrutinising the practice of accounting for so-called "capacity swaps" - when rival companies swap capacity to fill in gaps in their own networks. Qwest is investigating the issue and has not yet concluded whether the swaps had been incorrectly accounted for. 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