Rigases Repaid Adelphia, Defense Says
Attorneys for Adelphia Communications Corp. founder John Rigas and two of his sons Tuesday sought to show that the family repaid or intended to repay the company for cash transferred to them.
In some cases, Adelphia moved debt from its books to those of the Rigas family to cover some of the personal expenses the company had funded, a former employee testified.
James Helms, formerly Adelphia’s treasury supervisor, said June 2001 internal documents showed that Adelphia shifted $45.6 million in debt from its books to those of a Rigas-owned entity to cover expenses incurred by family partnerships in the quarter.
John Rigas, his sons Timothy and Michael and former executive Michael Mulcahey are on trial in Manhattan on charges of conspiracy and fraud. They are accused of cooperating to allow the Rigases to “loot” Adelphia “on a massive scale” and misleading investors, creditors and the public about the company’s finances.
Under questioning by defense attorneys, Helms also testified that Timothy Rigas reimbursed Adelphia for some of the payments it covered on his condo in Beaver Creek, Colo. A $397,335 check from him reimbursed Adelphia for 50% of the down payment it had paid and for additional payments, Helms said.
Helms, who is cooperating with the government in exchange for immunity from prosecution, added that Adelphia booked many of the personal expenses the firm funded for the Rigases as money owed by them.
In December 2001, $50 million in proceeds from a Deutsche Banc margin loan to the Rigases went to Adelphia, Helms said. Defense attorneys contend this was one repayment of the balance the Rigases owed the firm.
Helms said that $1.5 million wired through a Rigas family partnership to Michael, Timothy and their brother James Rigas in May 1999 was for “capital distribution” of interest payments and dividends on Adelphia securities that the Rigases held.
Helms also testified that $50 million that John Rigas got from the firm from 1997 to 2002 was from interest payments and dividends on securities he held. Helms also said that Adelphia covered the purchase of some of those securities for the Rigases.
The defense tried to discredit documents prosecutors presented when questioning Helms by exposing inaccuracies or gaps. In one case, Helms testified that a questionable receipt signed by Michael Rigas wasn’t the final one the firm used but a draft.
