John Rigas, the founder and former chairman and CEO of Adelphia Communications who was sentenced to 15 years in federal prison after a massive fraud scheme that afflicted the company over decades, died in Coudersport, Pennsylvania, on Sept. 30. He was 96 years old.

Rigas was the epitome of the bootstrapping cable executive, founding Adelphia in 1952 with his brother, Gus, with a $300 loan and eventually growing the company to the sixth-largest cable operator in the country with 5.5 million subscribers.

Rigas reveled in his rags-to-riches story and he often spoke of growing up in an apartment over his Greek immigrant parents’ diner (Texas Hot) in Wells, N.Y., and how he often slept in the Coudersport movie theater that was his first business venture. While he grew Adelphia mainly by acquisition — he famously paid the highest multiple ever (at the time) for a cable company, Daniels & Associates‘ Carlsbad, California, system in the early days — his empire came crashing down in 2004, when federal prosecutors claimed he and his family took from publicly traded Adelphia billions of dollars for their own personal use. 

Cable's Rock of Ages: Coudersport's Rigases

John Rigas was convicted of 18 counts of fraud and conspiracy in July 2004 and sentenced to 15 years in prison. His son, Adelphia chief financial officer Timothy Rigas, was convicted on 18 counts of fraud and conspiracy and sentenced to 20 years. John Rigas was released from federal prison in 2016 after serving nearly 10 years, when a judge ordered his compassionate early release after it was thought he had about six months to live. Rigas had earlier been diagnosed with Stage IV bladder cancer.

Timothy Rigas was released in 2019 after serving about 12 years of a 17-year sentence (reduced from 20 years in 2008), part of the federal First Step Act which allows for the early release of inmates convicted of nonviolent crimes who have served two-thirds of their sentence and are over the age of 60. Tim Rigas was scheduled to serve the remaining two years of his sentence in home confinement.

A third son, former Adelphia chief operating officer Michael Rigas, was granted a mistrial after jurors could not reach a verdict regarding 15 counts of securities fraud and two counts of bank fraud. He pleaded to a lesser charge of signing false documents and served a two-year sentence under house arrest.

A fourth executive, assistant treasurer Michael Mulcahy, was found not guilty. 

Fall of the House of Rigas: An Adelphia Time Line

The scandal erased more than 50 years of good will the Rigas family built up as it assembled its cable empire and rocked the industry as a whole. Coming at a time when the business world was swept up in off-balance sheet debt issues after the Enron and WorldCom scandals, some major figures, including cable legend John Malone, have said the Rigas family was unfairly treated. Others believed the family reaped what it sowed.

John Rigas continued to maintain his innocence until the day he died. In an interview with USA Today in 2007, he claimed that he could have cut a deal with the federal government by pleading to lesser charges and avoiding jail time, but he refused to plead guilty to something he believed he didn’t do. 

“My legacy is to my grandchildren, and you have to stand up — as difficult as it is — for something. And that is not something to be compromised or amended," Rigas told USA Today in 2007. 

The Rigases were accused of pillaging the company over a span of decades, siphoning money from operations and putting the company on the hook for about $2.3 billion in  off-balance sheet loans. In court documents, prosecutors accused the family of using Adelphia as its “personal piggy bank” and “personal ATM” financing a golf course, luxury condominiums and items as mundane as a $6,000 to fly two Christmas trees from Coudersport to daughter Ellen’s home in New York,  and John Rigas’ Columbia House record club subscription.

Adelphia’s fall began in March 2002 after company executives, during a conference call discussing Q1 results, couldn’t answer questions regarding $2.3 billion in off-balance sheet debt. It was later determined that the Rigases used those loans to buy Adelphia stock, which was used aggressively to buy other cable systems. 

Adelphia was sold in 2006 to Comcast and Time Warner Cable for $17.6 billion in cash and stock. 

Rigas is survived by his sons Timothy, Michael and James (CEO of Zito Media), his daughter Ellen and several grandchildren. His wife Doris predeceased him in 2014. 

Former Adelphia Communications chief financial officer Timothy Rigas has been released from prison after serving about 12 years of a 17-year federal sentence for fraud and conspiracy connected to the multi-billion dollar accounting scandal that shut down the former Pennsylvania cable operator in 2004.

Adelphia was once the fifth largest cable operator in the country. In the wake of the scandal, its systems were sold in 2006 to Comcast and Time Warner Cable, now part of Charter Communications.

Tim Rigas and his father John were convicted on 18 counts of fraud and conspiracy in 2004 connected with a massive accounting scandal where, according to the court, the Rigases used publicly-traded Adelphia as their personal piggy bank, using company funds to fund a lavish lifestyle. 

Related: Fall of the House of Rigas Timeline

Tim Rigas reported to serve his sentence in August 2007 and according to the Bureau of Prisons website, was scheduled to be released on June 3, 2022. His early release was part of a new federal law -- the First Step Act -- that allows for the early release of inmates convicted of nonviolent crimes who have served two-thirds of their sentence and are over the age of 60. Tim Rigas is 63 years old. He is expected to serve out the rest of his sentence -- about two years -- in home confinement.

Tim Rigas was originally sentenced to 20 years in prison, but that sentence was reduced to 17 years in 2008. His father John was originally sentenced to 15 years, but had that term reduced to 12 years.

John Rigas, the founder and former chairman of Adelphia, was released in 2016 after serving nearly 10 years, when a judge ordered his compassionate early release after it was thought he had about six months to live. John Rigas, who is now 94 years old, suffers from Stage IV bladder cancer. 

In a Facebook post, the elder Rigas, still very much alive, expressed his joy upon his son’s release, and stressed that the family continues to try to clear its name. Both John and Tim Rigas are trying to get their convictions overturned.

“For my family and me, this is a much-anticipated event and a tremendous blessing. We are elated!,” John Rigas said in his Facebook post. “Tim will be required to serve the remainder of his sentence, about two years, in home confinement. He and I continue to hope that our convictions will be overturned in the habeas corpus appeal that is pending in New York City, where our trial was held in 2004.”

John Rigas added that although he is elated about his son’s release, he was saddened that it did not come before the death of his wife Doris, who passed away in 2014. Tim was not allowed to attend his mother’s funeral.

“For so many years, she longed deeply to see her family reunited,” John Rigas wrote. “Although Doris’s physical absence leaves a tremendous void, her spirit—so full of determination and unconditional love for her family—will always be there to help sustain and guide us.”

Rigas apparently told the Potter County Leader-Entetrprise that Tim could work in another family cable business -- Zito Media, headed by James Rigas, Tim’s brother and John’s son. But he did not elaborate as to what role he could play. 

Last week’s sentencing of former Adelphia Communications Corp. founder, chairman and CEO John Rigas to 15 years in prison for securities and bank fraud and of his son, Timothy, the former chief financial officer, to 20 years was another milestone in a case that began innocuously enough with a fumbled answer during a routine quarterly conference call with analysts. A log of key dates follows:

March 27, 2002: In its first-quarter conference call with analysts, Adelphia reveals it could be liable for $2.3 billion in co-borrowing debt with Rigas family entities. On the call, CFO Tim Rigas assures analysts that the family has enough resources to back up the debt, but is unconvincing.

March 28, 2002: Adelphia continues to nosedive, falling another $1.80 per share to $14.90, after dropping $4 to $16.70 on March 27.

May 14, 2002: NASDAQ suspends trading in Adelphia, which last traded at $6.13.

May 15, 2002: Adelphia and subsidiaries miss $44.7 million in interest payments on senior and convertible notes.

May 17, 2002: Adelphia reveals it is the subject of grand jury investigations in New York and Pennsylvania.

May 18, 2002: Adelphia proposes selling systems in Los Angeles, Florida, Virginia, the Carolinas and Georgia to raise money to pay down debt.

May 19, 2002: Adelphia announces that James Brown, vice president of finance, has resigned.

May 23, 2002: John, Michael, James and Timothy Rigas resign from Adelphia’s board of directors and as officers of the company. The Rigases agree all company stock held by the family will be placed in a trust. Adelphia increases the amount of co-borrowing debt to $2.5 billion. Adelphia board member Erland Kailbourne becomes interim chairman.

June 11, 2002: Peter Venetis, John Rigas’s son-in-law, resigns from Adelphia board.

June 25, 2002: Adelphia files for Chapter 11 bankruptcy protection.

July 24, 2002: John, Tim and Michael Rigas are arrested by U.S. Postal Inspectors in New York; Brown and Michael Mulcahey (former assistant treasurer) are also arrested, in Williamsport, Pa. Additionally, the Rigases are named in civil lawsuits filed by Adelphia and the Securities and Exchange Commission.

Aug. 23, 2002: Adelphia’s $1.5 billion debtor-in-possession financing is approved.

Sept. 23, 2002: The Rigases, Brown and Mulcahey are indicted on 23 federal counts of fraud and conspiracy.

Nov. 14, 2002: Brown, hoping to receive a more lenient sentence, pleads guilty to conspiracy, securities fraud and wire fraud, and agrees to testify for the prosecution.

Jan. 17, 2003: Adelphia names former AT&T Broadband executives William Schleyer and Ron Cooper as chairman and CEO and president and COO, respectively.

March 28, 2003: The bankruptcy court approves Adelphia’s plan to move headquarters from Coudersport, Pa., to Denver.

Feb. 23, 2004: Jury selection in the federal fraud trial of the Rigases and Mulcahey begins.

Feb. 25, 2004: Adelphia receives $8.8 billion exit-financing commitment from four banks and files reorganization plan in bankruptcy court.

March 1, 2004: Trial begins in Manhattan.

April 22, 2004: Adelphia, pressed by creditors, agrees to pursue a dual-track strategy of emerging from bankruptcy as a whole entity while also exploring a sale of its assets.

April 29, 2004: Brown, the government’s star witness, begins the first of 14 days of testimony.

June 2, 2004: Mulcahey, the only defendant who will take the witness stand, begins seven days of testimony.

June 28, 2004: Jury deliberations begin.

July 8, 2004: Jury finds John and Tim Rigas each guilty on 18 counts of conspiracy and securities and bank fraud, but not guilty on five counts of wire fraud. Michael Rigas is found not guilty on one count of conspiracy and five counts of wire fraud, but the jury remains undecided on 17 counts of securities and bank fraud. Mulcahey is found not guilty on all counts.

July 9, 2004: A mistrial is declared in the case of Michael Rigas on the 17 counts of securities and bank fraud.

July 14, 2004: Adelphia hires UBS Investment Bank and Allen & Co. as advisors for a possible sale.

August 20, 2004: Adelphia files papers with the U.S. Bankruptcy Court in Manhattan asserting that the Rigas family owes the MSO more than $3.2 billion; a hearing is scheduled for October 22.

Sept. 21, 2004: Adelphia splits itself into seven separate clusters, making it easier for potential bidders to make offers for parts of the company.

Oct. 26, 2004: U.S. District Court Judge Leonard Sand agrees to drop the bank-fraud charges against Michael Rigas.

Oct. 31, 2004: Deadline for preliminary bids. More than 50 interested parties submit bids, including a joint bid from Time Warner Inc. and Comcast Corp.

Nov. 1, 2004: U.S. District Court Judge Leonard Sand approves a retrial for Michael Rigas on the securities-fraud charges.

Dec. 14, 2004: The Justice Department asks a judge at the U.S. District Court for the Southern District of New York to enter a $2.53 billion judgment against John and Tim Rigas.

January 5, 2005: John and Tim Rigas are scheduled to be sentenced, but sentencing is postponed. It will continue to be postponed numerous times between January and June.

Jan. 31, 2005: Final bids on Adelphia systems due.

March 21, 2005: Time Warner finalizes a $300 million settlement with the U.S. Securities and Exchange Commission concerning accounting irregularities at its America Online unit. The move will allow Time Warner to issue stock again.

March 24, 2005: Adelphia proposes settling claims by SEC and DOJ for $725 million.

April 5, 2005: Cablevision Systems Corp. reportedly lobs in a $16.5 billion all-cash offer for Adelphia’s cable systems.

April 8, 2005: Adelphia reaches agreement in principle with Time Warner Inc. and Comcast to sell its 5.2 million cable subscribers for between $17.6 billion and $18 billion in cash and stock.

April 25, 2005: Adelphia settles fraud charges with the SEC and DOJ, agreeing to pay $715 million in cash. The move clears the way for the MSO’s pending sale to Time Warner and Comcast, and removes the threat of prosecution. As part of the agreement, the Rigas family has agrees to surrender about $1.5 billion in assets to Adelphia, including its interests in various cable properties.

June 20, 2005: Judge Sand sentences John Rigas to 15 years and his son Tim Rigas to 20 years for their part in what the judge called “one of the greatest frauds in corporate history.”

Sept. 19, 2005: John and Tim Rigas are to report to begin their prison sentences.

October 15, 2005: The retrial of Michael Rigas on 15 counts of securities fraud is scheduled to begin.

Source:Multichannel News research