AP
Adelphia Founder Rigas, Son Face Sentencing
Monday June 20, 9:56 am ET
 
By Erin Mcclam, Associated Press Writer

Adelphia's Founder John Rigas and Son Face Sentencing Almost a Year After Being Convicted

NEW YORK (AP) -- Adelphia Communications Corp. founder John Rigas and his son faced sentencing Monday, almost a year after they were convicted of stealing millions of dollars from the cable company and deceiving investors by hiding its crushing debt.

Rigas and his son Timothy, the company's former chief financial officer, faced up to 30 years in prison each on their bank fraud convictions alone. They were also convicted of securities fraud and conspiracy.

Federal sentencing guidelines would make the sentence far less than 30 years, but the Supreme Court also ruled earlier this year that federal judges should consider the guidelines as advisory, not mandatory.

The sentencings were set for Monday afternoon at a federal courthouse in downtown Manhattan. They come just three days after another major white-collar conviction: A state court jury found former Tyco International Ltd. CEO L. Dennis Kozlowski and former Tyco CFO Mark Swartz guilty of looting that company of $600 million.
 
John Rigas, 80, founded Adelphia with a $300 license in 1952, took it public in 1986 and built it into a cable titan by acquiring other systems in the 1990s.
 
The company, then based in tiny Coudersport, Pa., collapsed into bankruptcy in 2002 after it disclosed a staggering $2.3 billion in off-balance-sheet debt. It now operates under bankruptcy protection in Greenwood Village, Colo.

At the trial, prosecutors said the Rigases used complicated cash-management systems to spread money around to various family-owned entities and as a cover for stealing about $100 million for themselves.

Prosecutors also described a lengthy list of personal luxuries that they said the Rigases financed with money stolen from the company.

One prosecutor said John Rigas had ordered two Christmas trees flown to New York for his daughter at a cost of $6,000. Prosecutors also said he ordered up 17 company cars and had the company buy 3,600 acres of timberland at a cost of $26 million to preserve the view outside his Coudersport home.

Rigas' lawyer told jurors those charges were ludicrous and that "if you saw this on 'Seinfeld,' you'd double up."

A second Rigas son, Michael, former executive vice president for operations, was acquitted of conspiracy and wire fraud. However, jurors were deadlocked on 15 counts of securities fraud and two counts of bank fraud. He is scheduled for a second trial in October.

Former Adelphia assistant treasurer Michael Mulcahey was tried with the Rigases but was acquitted of all charges.