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Non-Tech : The Enron Scandal - Unmoderated -- Ignore unavailable to you. Want to Upgrade?

To: stockman_scott who wrote (2549)	11/14/2002 11:00:53 AM
From: Glenn Petersen	Respond to of 3602

Ex-Adelphia exec to plead guilty Finance officials set to testify against Rigas family members By Jerry Markon THE WALL STREET JOURNAL msnbc.com Nov. 14 — In a development that could help the government’s case against the Rigas family members who founded Adelphia Communications Corp., the company’s former vice president for finance is scheduled to plead guilty Thursday and has agreed to testify against the family members, people familiar with the matter said. JAMES R. BROWN’S expected plea could be especially damaging to Timothy J. Rigas, son of Adelphia founder John J. Rigas, because Mr. Brown reported directly to Timothy Rigas when Mr. Rigas was Adelphia’s chief financial officer, the people said. Mr. Brown is cooperating in the case against all three Rigas family members charged in the case. The elder Mr. Rigas, along with sons Timothy J. and Michael J., were indicted by a federal grand jury in September and charged with looting the company for hundreds of millions of dollars in a massive scheme to defraud investors. The family members were first charged in a criminal complaint in July, when they were rousted from their company-owned apartment on New York’s upper East Side in an early morning arrest that drew criticism from defense lawyers. A lawyer for Mr. Brown, Howard Heiss, didn’t return telephone calls. The Rigas family members have pleaded not guilty and denied wrongdoing. Jeremy Temkin, a lawyer for Timothy Rigas, declined to comment Wednesday. Lawyers for John J. Rigas and Michael Rigas didn’t return telephone calls. Although lawyers for the Rigas family members have held talks with prosecutors, the family members have indicated no desire to plead guilty and are planning to take the case to trial, people familiar with the case said. That makes the testimony of Mr. Brown especially important because the family members appear to be sticking together in their defense. Like the Rigas family members, Mr. Brown is charged with conspiracy, securities fraud, wire fraud and bank fraud. Another former Adelphia executive, Michael C. Mulcahey, is charged on the same counts. He has indicated no desire to plead guilty, people familiar with the case said. Until recently, Mr. Brown had also refused to cooperate with investigators and had used his Fifth Amendment rights when questioned, a person familiar with the case said. It is unclear what made him change his mind — or what specific counts he is planning to plead guilty to. Prosecutors allege in the case that the Rigases spent company funds on amenities such as a $12.8 million golf course and used more than $250 million to meet margin calls on their private stock holdings, covering up their actions with fictitious receipts and falsified financial reports. In one allegation, the elder Mr. Rigas is accused of racking up more than $66 million in personal debt and then withdrawing so much money from the company for personal use that his son Timothy had to limit him to $1 million a month. Copyright © 2002 Dow Jones & Company, Inc. All Rights Reserved.