Ex-Adelphia exec pleads guilty to fraud
A second former executive of bankrupt cabler Adelphia Communications pled guilty Friday to charges of financial fraud in a move that seems sure to put increasing pressure on members of Adelphia’s founding Rigas family.
Timothy Werth, former director of accounting at Adelphia, pled to one count of securities fraud and one count of conspiracy to commit fraud before U.S. District Judge Gerard Lynch in the Southern District of New York.
In a statement to the court, Werth said: “From 2000 through the beginning of 2002, I agreed with Adelphia employees senior to me such as Jim Brown and Tim Rigas, and with others, to wrongfully and falsely record certain transactions, including some fictitious transactions, in Adelphia’s books and records.
“I knew that our actions would make it seem as though Adelphia was performing materially better than it actually was performing,” he added.
Prosecutors allege that the Rigases used $250 million in company funds for personal expenses and failed to disclose $2.3 billion in loans to family-controlled entities. Adelphia filed for Chapter 11 last year, citing $20 billion in debt.
Werth’s boss, Adelphia’s former finance head James Brown, pleaded guilty in November to conspiracy, bank fraud and securities fraud. Both men still face years in prison when sentencing rolls around, but prosecutors could recommend leniency depending on their cooperation.
Brown, former exec Michael Mulcahey and three members of the Rigas family were arrested last summer. The Rigases have pled not guilty on all counts.
On Thursday, a federal judge set a Jan. 5, 2004, trial date for John Rigas, Adelphia’s founder and former chairman, and two of his sons. Their lawyers are pushing for a change of venue from New York to Pennsylvania, where the cable company is based.