MANHATTAN (CN) – The federal government is returning $728 million to more than 13,000 victims of the Rigas family’s fraud while they ran Adelphia Communications, the U.S. Attorney’s Office said Tuesday.
Adelphia CEO John Rigas and CFO Timothy Rigas were convicted in 2004 of securities fraud, and they and other members of the Rigas family “agreed to forfeit more than 95 percent of the family’s assets to the government. The Adelphia distribution is the largest single distribution of forfeited assets to victims in Department of Justice history,” the U.S. Attorney’s Office said in a statement.
The frauds were discovered in March 2002 when the company acknowledged that it had lied about its finances “to cover up accounting fraud and looting of its assets,” prosecutors said in the statement. Adelphia, a cable company, filed for bankruptcy in June 2002 and shareholders lost the value of their holdings.
The two top Rigases settled with the government after it agreed not to criminally prosecute them, prosecutors said.