Qwest Says Requested Documents Should Remain Private

Qwest Says Requested Documents Should Remain Private

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DENVER (AP) -- Qwest, whose accounting practices are under federal regulatory scrutiny, contends that some documents the Security and Exchange Commission wants to review should remain private, a newspaper reports.

The government is seeking documents from one of Qwest's outside law firms, Boies, Schiller & Flexner, but Qwest says the documents are covered by attorney-client privilege, The Denver Post reported, citing two unnamed sources.

The commission declined comment. Qwest and Jonathan Schiller, a partner at the law firm, would only say on Thursday that the company was cooperating with the investigation.

A settlement between the commission and Qwest was expected within the next few months.

Qwest hired Schiller's firm in February to participate in the company's internal investigation of its accounting. The firm advised Qwest in April, when the company's board was told that the internal probe found no problems, and in July, when the board was told accounting issues would, in fact, force Qwest to revise its financial records.

Since the federal investigation began last spring, the company has announced plans to revise more than $1.6 billion in revenue and costs.

The U.S. attorney's office in Denver also is investigating Qwest. The No. 2 executive at the office, Bill Leone, said earlier this month he was turning down consideration for a federal judgeship so he could complete the Qwest investigation.

U.S. Attorney John Suthers acknowledged the office was at a critical point in the investigation but would not say whether charges would result.

Qwest has said it hopes to have its reaudit of its books complete by March 31.

(Copyright 2003 by The Associated Press. All Rights Reserved.)

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