Tax shelter being defended by Sprint chairman

OVERLAND PARK, KANSAS - Sprint Corporation&#39;s chairman and CEO is defending his use of a controversial tax shelter said to be partly responsible for the company&#39;s decision to seek an executive at Atlanta-based BellSouth as his replacement. <br> <br> In a letter to Sprint employees released last night, William Esrey said he was assured that the investment and tax strategy recommended to him in the late 1990s by the telecommunication company&#39;s auditors, Ernst and Young, was perfectly legal. <br> <br> And, he says Sprint&#39;s board knew about the tax strategy he was using. <br> <br> The tax strategy, said to be similar to what many other top corporate executives have used, allowed Esrey and another top executive to defer taxes from on-paper profits for stock options they got in 1999 and 2000. <br> <br> With Sprint&#39;s stock down sharply, those options are now worth substantially less than they were two years ago. <br> <br> The issue is reportedly one of the reasons Sprint is seeking to replace Esrey with BellSouth vice chairman Gary Forsee. BellSouth, meanwhile, is trying to prevent Forsee from taking the top job at Sprint.

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