Adelphia Communications Corp. is expected to pay as much as $725 million to the Justice Department and the Securities and Exchange Commission, one of the biggest penalties for corporate fraud, aimed at the settlement of the charges of massive fraud in the company.

Adelphia is the fifth-largest cable company for the US. It filed for bankruptcy protection in 2002 and now may be sold in a bidding. The penalty for the company is slightly less than WorldCom’s $750-million settlement in 2003.
The company may be bought by either Time Warner Inc. or Comcast Corp. Comcast offered $17.6 billion in stock and cash for Adelphia.

The SEC explains the amount of money to be paid with the size of fraud and the necessity to compensate losses to the shareholders.

The company collapsed in 2002 after the huge fraud from the company’s founders, the Rigas family, was disclosed.

John Rigas, Adelphia’s founder, and his son Timothy, Adelphia’s former chief financial officer, were charged last summer with siphoning millions of dollars of Adelphia funds for personal needs last summer. They are now facing as many as 30 years in jail.