Under cross-examination by prosecutors last Thursday, former Adelphia Communications Corp. assistant treasurer Michael Mulcahey testified that he was more concerned about pleasing Adelphia founder John Rigas and his sons Timothy and Michael than the MSO’s shareholders.
“I guess I always felt like I had to please my boss in whatever job I was in. I’m not sure I thought in terms of the shareholders. I just thought of doing my job and doing what my supervisor was asking me to do,” Mulcahey testified during the 15th week of the trial.
Mulcahey and former Adelphia chairman John Rigas, former chief financial officer Timothy Rigas and former executive vice president Michael Rigas face 24 counts of fraud and conspiracy for allegedly looting billions of dollars from Adelphia.
LETTERS TO D&T
Mulcahey also testified that he signed letters to Adelphia auditors Deloitte & Touche vouching for the accuracy of Adelphia’s financial statements between November 1998 and November 2001, even though he said he hadn’t read the financial statements.
“I’d asked Deloitte if I could no longer sign these letters, and they said, well, because debt is such a significant area, the credit agreement debit, that they preferred me to continue signing them. And that was what I was told by them,” Mulcahey said.
Adelphia imploded in March 2002, after it revealed that it could be liable for $2.3 billion in debt used by the Rigas family to buy Adelphia stock.
Last Wednesday (June 9), Mulcahey testified that he met in May 2002 with government prosecutors and representatives from the Securities and Exchange Commission who were investigating Adelphia at the time.
While former Adelphia director of finance Jim Brown reached an agreement with prosecutors to testify against the Rigases and Mulcahey in exchange for a favorable sentencing recommendation, Mulcahey was not offered a similar deal. “I understood that the government didn’t believe some of the answers that I [gave in May 2002], and unless I was going to change some of those answers that they didn’t want to talk any longer,” he testified, according to transcripts provided by Bloomberg News.
Mulcahey said he continued to work for Adelphia until he was arrested on July 24, 2002. He said he then obtained an administrative job at Advanced Monolithic Ceramics, a manufacturer in Olean, N.Y., but he lost that job in April 2003, after the company was acquired by another firm.
Mulcahey said the Rigas family hired him in May 2003 as a consultant to help them prepare for the trial. He continues to work for the Rigas family, earning $1,846 per week.
The prosecution’s cross-examination of Mulcahey is scheduled to resume Monday morning, after the U.S. District Court canceled last Friday’s session in observance of former president Ronald Reagan’s funeral.
Closing arguments could begin as soon as this week.