Qwest Says It May Face SEC Action Over Data

Qwest Communications International Inc. said it may be charged by federal securities regulators for allegedly failing to provide earnings data in accordance with generally accepted accounting principles.

Securities and Exchange Commission staff reviewed Qwest’s fourth-quarter and full-year 2000 earnings news release, the seller of local and long-distance telephone services said in an SEC filing. The release provided “pro forma normalized earnings information” that excluded certain costs related to Qwest’s acquisition of US West Inc., the filing said. The release was issued Jan. 24, 2001. Qwest, which will have an opportunity to rebut the charge, said in the filing that it “believes that an action by the SEC would be without merit.”

Denver-based Qwest’s swaps of capacity on its fiber-optic network with other telephone companies already are under SEC investigation. Investors have questioned whether Qwest inflated sales by trading pieces of its voice and data-transmission system with rivals.

Qwest shares fell 22 cents to $8 on the New York Stock Exchange.