John Rigas, the founder of Adelphia Communications, was sentenced to 15 years in prison today for taking millions of dollars from the company for his own personal use, and lying about finances.
Rigas is 80 years old, so a 15 year sentence sure doesn’t seem like small potatoes. He and his son Timothy Rigas, the company’s former CFO, were convicted last year of conspiracy and securities fraud that ultimately led to Adelphia’s bankruptcy.
Prosecutors said the two also lied to banks to obtain large personal loans and used phony accounting to conceal $2.3 billion of debt from investors. They also made false public statements to mislead investors about the damage their looting was causing the company.
Earlier this year, the Rigas family agreed to give up $1.5 billion in cable TV assets to settle securities and accounting fraud charges filed by the Securities and Exchange Commission and the Justice Department.
This makes up 95% of the family’s total assets, and includes real estate, bonds, and cable-television systems. The company will still have about $45 million is assets.
The Rigas’ trial lasted for five-months before the two were convicted. The jury deadlocked on the trial of Michael Rigas. HIs new trial will begin in October. There was a fourth defendant in the trial, Michael Mulcahey, but he was acquitted.
Back in 2002, Adelphia filed for Chapter 11 bankruptcy protection. The company has since agreed to be acquired by Time Warner and Comcast for $18 billion.
Chris is a staff writer for Murdok. Visit Murdok for the latest ebusiness news.
