Adelphia Communications Corporation
Adelphia Communications Corporation was one of the largest cable and internet providers in America prior to its declaration of bankruptcy in 2002 due to internal corruption. The executive officers of Adelphia inflated the stock price of the company by falsifying their financial records as well as funneling their debts into other smaller firms so that the large amounts of debt did not show on their financial reports. This lead investors to believe the company was performing significantly better than it actually was. The owners of the company used these investors’ money to take out personal loans for themselves that were backed by the company itself. They acquired homes in New York among other places, private jets, and even a majority ownership in the Buffalo Sabres professional hockey team. They also purchased the naming rights to the stadium of the Tennessee Titans professional football team in Nashville, Tennessee. It was renamed the “Adelphia Coliseum.” The founder of Adelphia Communications Corporation was John Rigas. He purchased the company in 1952 for $300. It was originally purchased to hedge against lost revenue at his movie theater. In 1972, he and his brother, Gus, joined to form Adelphia Communications Corporation. The word Adelphia is Greek for “brothers.” This was to signify that the company was a “family business.” In the late 1990’s, the company purchased Century Communications for $5.2 billion and became the sixth largest cable company in America with 5.6 million subscribers. Rigas loved the limelight and enjoyed the spotlight that came with being the president of such a large corporation. After the acquisition of the ownership stock in the Sabres franchise, Rigas demanded that the television network that broadcast the team’s games show him at least once a game for everyone to see. He also purchased homes for other people and flew people on private jets to receive medical attention. When...
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