Qwest May Retract $1 Billion in Revenue

Qwest Communications International expects to announce this week that it plans to retract about $1 billion in revenue booked from swaps of capacity on its fiber-optic network, sources told Associated Press.

The announcement, initially reported in Saturday editions of the Rocky Mountain News, probably would come before the House Energy and Commerce Committee begins hearings on the deals Tuesday.

Qwest spokesman Tyler Gronbach said the committee and full board of directors met last week but would not say what they discussed.

Regulatory filings show that Qwest recognized $953 million in revenue from so-called swaps in 2000 and 2001 in which it nearly simultaneously bought and sold network capacity with another telecommunications company.

The Securities and Exchange Commission is investigating whether the deals helped Qwest artificially boost revenues. Qwest also is the subject of a Justice Department investigation.

Two Qwest executives were scheduled to testify in congressional hearings Tuesday, and former Chief Executive Joe Nacchio is expected to testify in October.