Rigas Brother Pleads Guilty in Adelphia Scandal

25 November 2005

The fraud-triggered collapse of US cable company Adelphia Communications has claimed another Rigas family scalp.

Former executive vp Michael is son of disgraced ex-chairman John and brother to erstwhile chief financial officer Timothy, both of whom were convicted last year of looting the company to line their pockets. Also of hiding more than $2 billion (€1.69bn; £1.16bn) in company debt.

Michael plead guilty in New York to making a false entry in Adelphia's fiscal records. He admitted filing a form with the Securities and Exchange Commission in December 1999 that falsely stated he had conducted an inquiry into the source of funds used for a purchase of Adelphia shares.

He told the court: "I knew it was wrong to sign a certification stating that I had conducted a reasonable inquiry when I neglected to do so."

Michael Rigas will be sentenced next March and faces up to three years in jail. However, his guilty plea means he avoids a retrial on fifteen counts of securities fraud that was set to begin early next year.

John (81) and Timothy are free on bail pending an appeal against their respective 15 and 20 year sentences. They also face tax evasion charges [WAMN: 11-Oct-05].

Adelphia, which imploded as a result of the scandal, agreed to sell itself in April to media giant Time Warner and US cable leader Comcast for $12.7 billion in cash and 16% of the common stock of TW's cable unit.

Data sourced from Wall Street Journal Online; additional content by WARC staff