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Adelphia Offers $300 Million to Settle Probes

Dec 28, 2004  •  Post A Comment

Adelphia Communications, the bankrupt cable operator that put itself up for sale earlier this year, has offered to pay the U.S. government $300 million to settle a series of probes into how the company conducted itself under its previous owners, the Rigas family.

In its 2003 annual report filed Dec. 23, the first filed by the company since 2000, the company said it proposed paying the U.S. Department of Justice and the Securities and Exchange Commission a combined fine of $300 million to settle securities fraud and accounting violations that forced the company to file for bankruptcy in 2002 and that ultimately led to the conviction of founder John Rigas and his son Timothy Rigas.

There was no indication whether either agency accepted the offer or what the status is of Adelphia’s negotiations with the government.

News of the settlement offer comes as the Justice Department moves toward seizing a number of cable systems owned by the Rigases but operated by Adelphia in a bid to collect part of a $2.53 billion judgment the government wants entered against Adelphia in connection with the accounting scandal.

The 2003 annual report was seen as a significant event for Adelphia, given the filing last week marked the culmination of a 20-month review of the company’s books.

In the annual report, Adelphia said it booked a 2003 loss of $839.9 million on $3.61 billion in revenue, compared with a 2002 loss of $7.25 billion on $3.27 billion in revenue and a 2001 loss of $6.17 billion on $3.3 billion in revenue.