Get a demo Do I subscribe? News sign-up
Print

Adelphia Auditors' Role Highlighted In US Fraud Trial

News, 10 May 2004


The former auditors of collapsed cable company Adelphia Communications Corporation were thwarted in their attempt to expose financial irregularities, a court has heard.

James Brown, Adelphia's former vice-president of finance told a Manhattan court how he and Adelphia executive Timothy Rigas persuaded auditors Deloitte & Touche to suppress sensitive financial information in 2001.

A year later the company filed for bankruptcy after it was discovered that the Rigas family, controllers of Adelphia, had borrowed nearly $2.3 billion (€1.9bn; £1.2bn) instead of the $250 million they claimed.

The deception was compounded by the fact that the Rigas clan used more than 50% of the money to buy Adelphia stock, rather than upgrading cable systems as they claimed.

Timothy Rigas, his father and Adelphia founder, John, brother, Michael, former executive vice president for operations; and Michael Mulcahey, former director of internal reporting, all deny bank fraud, securities fraud and conspiracy. The trial continues.

Data sourced from: New York Times; additional content by WARC staff