Rigas Routinely Sought Cash From Adelphia, Accountant Says

A former accountant for Adelphia Communications Corp. said Monday that founder John Rigas was still so strapped for cash after getting an improper $15-million payment that he forced the then-employee to arrange a fraudulent $20,000 personal loan and give him the money.

Accountant Christopher Thurner testified at the fraud trial of Rigas, 79, that his boss routinely sought unauthorized cash payments from Adelphia, including a $15-million wire transfer in 1994 for personal expenses and private businesses. Prosecutors allege that Rigas and two of his sons, Michael, 50, and Timothy, 47, looted Adelphia and hid $2.3 billion in debt.

Thurner said that even after the 1994 cash infusion, John Rigas told him in June 1995 to take out a $20,000 loan from Empire Sports Network, a joint venture of the family and Adelphia. Rigas wanted the money to help him through a cash crunch, said Thurner, whose salary was then in the mid-$40,000s.

“I indicated to him that it was something I was extremely uncomfortable in doing,” Thurner told federal jurors in New York. “I mean it’s a fraud.”

Rigas approved the $20,000 loan by Empire Sports Network, said Thurner, who feared exposure of the transaction because he was the company’s accountant. Prosecutors showed jurors the $20,000 check that Thurner wrote to Rigas. Thurner said that Rigas promised a dozen times to repay him and never did.

Thurner said Rigas continued to draw cash advances, tapping syndicated loans taken by Adelphia and private family businesses for $50 million between 1997 and May 2002. The Rigases resigned that month from Adelphia, the No. 5 cable television operator, which filed for bankruptcy protection in June 2002.

Thurner also testified that he was “extremely uncomfortable” with another scheme to raise cash through a phony reimbursement scheme involving condominium time shares in Cancun, Mexico, owned by a private Rigas business. Adelphia would reimburse the Rigas business for their use, Thurner said.

Around 1995, Thurner said, Rigas asked him to submit phony invoices for reimbursement for guests who never stayed at the condos. Thurner said he protested and Rigas overrode him, forcing him to charge Adelphia about $350 a night for the phantom visits and receive payments from the company.

Thurner said he told Rigas that the practice “is something that really could come back and blow up” on them if uncovered.

“He said, ‘Chris, I need the money right now,’ ” Thurner testified. “He said, ‘If you don’t submit these invoices you can go find yourself another job.’ ”

Thurner said that he submitted the fake invoices five or six times a year until 2002.

Several witnesses have said the Rigases and their friends took personal trips on company jets and spent millions of dollars of Adelphia money on golf, family properties, antiques, estate planning and credit cards. Defense attorneys say the Rigases intended to repay those expenses and more than $1 billion in company money used to buy Adelphia securities.