Adelphia pair ordered to prison

Judge carries out sentencing for Rigas and son

A judge Wednesday ordered Adelphia founder John Rigas and his son, Timothy Rigas, to report to prison on Aug. 13, nearly three years after they were convicted of one of the largest corporate frauds in U.S. history.

Both men had been free on bail while they appealed, but U.S. District Judge Leonard Sand said the time had come for the two to start paying their debt to society.

“Too much time has elapsed,” he said.

Neither the 82-year-old Rigas patriarch nor his 51-year-old son reacted visibly to the judge’s order, which had been expected. Both appeared downcast as they hugged relatives in a courthouse hallway after the hearing, and declined to comment to reporters.

A federal appeals court had cleared the way for the pair to begin serving time in May when it upheld all but one count of their convictions on multiple charges of securities fraud, conspiracy to commit bank fraud and bank fraud.

John Rigas was sentenced to 15 years in prison. Timothy Rigas, the company’s former chief financial officer, was sentenced to 20 years.

Prosecutors at the trial said the Rigases had concealed nearly $2.3 billion in Adelphia debt from stockholders, making the company look good even though its finances had became dangerously overextended.

They also accused the family of using the company as their personal ATM machine, withdrawing millions of dollars to buy everything from 100 pairs of bedroom slippers for Timothy Rigas to more than $3 million to produce a film by John Rigas’ daughter. Prosecutors said John Rigas used expensive jets to fly eggs, paper towels, and two Christmas trees to his daughter in New York.

Last year, another son, Michael Rigas, was sentenced to 10 months of home confinement after pleading guilty to a charge of making a false entry in a company record.

The next step in the case will be for the federal Bureau of Prisons to decide where they will serve time.

The sentencing judge, citing the elder Rigas’ poor health, had previously said his term might be cut short if he serves at least two years.

After years of fighting the case, the Rigas family is almost out of options. Their appeal is still alive, but barely. They have asked the appeals court to reconsider the case, and also plan to ask the Supreme Court to intervene, but such requests are rarely granted.

Sand noted that the delay in imposing the Rigases’ punishment has been unusual.

They were initially convicted in 2004, but their sentencing was delayed for nearly a year while they negotiated with prosecutors over restitution payments to Adelphia stockholders.

Adelphia was the country’s fifth-largest cable television company before its collapse in 2002. At its peak, it served more than 5 million customers in 31 states. Its stock value was nearly entirely erased after the company disclosed its off-balance-sheet debt.

Founded in Coudersport, Pa., the company declared bankruptcy, severed its ties with the Rigases, and moved its corporate headquarters to Greenwood Village, Colo.

Comcast Corp. in Philadelphia and Time Warner Cable, a unit of Time Warner Inc., have since bought Adelphia’s cable assets.

Want to read more articles like this one? SUBSCRIBE TO VARIETY TODAY.
Post A Comment 0

Leave a Reply

No Comments

Comments are moderated. They may be edited for clarity and reprinting in whole or in part in Variety publications.

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

More Biz News from Variety

Loading