Corporate scandals touch Beaver Creek mansions
September 22, 2005
BEAVER CREEK – Dennis Kozlowski, the former chief executive officer of the Tyco International Corporation, owns a big house in Beaver Creek – some 8,627 square feet of big. When he bought it in 2000, the house cost $8.45 million.Now, he’s going to what is often called the Big House – a state prison in New York. Kozlowski, 58, was sentenced Monday to 25 years for looting the company of hundreds of millions of dollars. Kozlowski will be eligible for parole in 8 years and 4 months.
He is not the first Beaver Creek homeowner to be found guilty of corporate theft. Earlier this year, Adelphia Communications Corp. founder John Rigas was sentenced to 15 years in prison and his son, Timothy Rigas, was sentenced to 20 years. They also own homes in Beaver Creek.Kozlowski was accused of stealing $180 million from the company outright. In June, while finding Kozlowski guilty, a jury found that he and Mark H. Swartz, Tyco’s former chief financial officer, had also stolen another $430 million by secretly selling shares of company stock whose value they had inflated artificially. A prosecutor during the trail said the actions of Kozlowski and Swartz had made Tyco a “world-wide symbol of kleptocratic management.” Swartz, 44, was also sentenced to 25 years in prison this year. New York Supreme Court Justice Michael Obus ordered the pair to pay $134 million total in restitution to Tyco. He also fined Kozlowski $70 million and Swartz $35 million.
Public records show that in 2000 Kozlowski bought a home in the Bachelor Gulch neighborhood of Beaver Creek. The next year, he purchased a 2,300-square-foot condominium in the Beaver Creek Lodge for $1.325 million. Later that same year, he paid $4 million for a lot in Bachelor Gulch.CNN reports that because he was tried on state, instead of federal, charges, Kozlowski will be housed among rapists and murders.A similar case involves the Rigas family. John Rigas founded the cable-television company in 1952 with a $300 investment. Hailed as a hero in his hometown of Coudersport, Pa., for supporting various causes, he is now 80 and in ill health. He was found guilty earlier this year of using complicated cash-management systems to spread money around to various family-owned entities and as a cover for stealing about $100 million, which caused the company to go bankrupt.
Timothy, the son of John Rigas, was sentenced to 20 years in federal prison, while the elder Rigas was sentenced to 15 years. Although he could die behind bars, his sentence could be cut short if he has served at least two years and his doctors believe he has less than three months to live. CNN noted that federal prisons, although unpleasant, are much less dangerous places for inmates than the state prisons where the Tyco executives will spending their coming years.The elder Rigas, along with his wife, Doris, owns a 4,400-square-foot condominium in the Greystone project at Beaver Creek. County assessors estimate its value at $3.8 million. Timothy Rigas, has a 3,000-square-foot condo at One Beaver Creek Condos for which he paid $2.4 million in 1997.Public records tend to lag sales by about a month, but so far show no sale of the properties purchased by either Kozlowski or the Rigas family.
Also facing charges of high-end thievery is former Beaver Creek property owner Alberto Vilar, 64, the founder of Amerindo Advisors and a major philanthropist, both here and across the world. Altogether, he has given $10 million in the Eagle Valley, including major donations to the Ford Amphitheater and his namesake Vilar Center for the Arts.Although once estimated to be worth nearly $1 billion, he was jailed in May fro allegedly stealing $5 million from an investor, partly to meet his pledges. However, he could not come immediately up with the $10 million bail and remained in jail for 25 days.Vail, Colorado