Nation digest 09/24/02

Adelphia founder indicted on new fraud charges

NEW YORK -- Adelphia Communications Corp. founder John J. Rigas, his sons and two other former executives were indicted Monday on charges that included conspiracy, securities fraud and wire fraud.

The indictment also seeks $2.5 billion in forfeiture for the alleged large-scale accounting fraud and corporate looting.

In addition to charges filed in a criminal complaint in July, Monday's 24-count indictment added new securities fraud charges and conspiracy charges stemming from allegedly false statements made in filings to the Securities and Exchange Commission.

The court papers name Rigas; his sons, Timothy and Michael; James R. Brown, former vice president of finance; and Michael C. Mulcahey, former director of internal reporting.

An earlier criminal complaint charged them with fraud for allegedly hiding $2.3 billion in liabilities from investors.

Attorneys for all five have denied their clients have committed any wrongdoing.

Miss Universe fired; runner-up to take over

NEW YORK -- For the first time in its 52-year history, the Miss Universe Organization has fired the woman wearing its crown.

Oxana Fedorova, a 24-year-old Russian law student, was ousted four months after she won the pageant, the organization said.

Spokeswoman Mary Hilliard McMillan said the organization would not comment on the reason until today, when the first runner-up, Miss Panama Justine Pasek, 22, is expected to be crowned.

Fedorova denied she had been fired and said she gave up the title herself.

"The duties of a world beauty are wonderful. However, my prime goal is my studies and career in Russia," Fedorova, who is pursuing a graduate degree in civil law, told RTR state television.

Salomon Smith Barney is fined $5 millionNEW YORK -- Salomon Smith Barney agreed to pay a $5 million fine Monday to settle charges it issued misleading research reports.

The penalty was levied against the Citigroup Inc. investment banking division by the National Association of Securities Dealers.

NASD found that Salomon Smith Barney's reports on Winstar failed to adequately disclose the risks of investing in the broadband telecommunications service provider, which filed for bankruptcy protection last year. The reports consistently praised Winstar and belittled other analysts

Salomon agreed to the fine without admitting or denying the findings.

California now first state to offer paid family leave

LOS ANGELES -- Gov. Gray Davis signed a law Monday that makes California the first state to offer workers paid family leave.

The law -- financed by an employee payroll tax -- allows workers to take six weeks off to care for a newborn, a newly adopted child or ill family member. Employees will be eligible to receive 55 percent of their wages during their absence, up to a maximum of $728 a week.

Supporters hope the bill will serve as a national model. Business groups denounced it as too costly for employers.

Federal law grants up to 12 weeks of unpaid leave for workers at businesses with more than 50 employees.

Workers will be allowed to start taking time off as of July 1, 2004.

-- From wire reports