January 10, 2003

PRESS RELEASE

FORMER VICE-PRESIDENT OF NATIONAL AMUSEMENTS
CONVICTED ON FRAUD AND TAX CHARGES;
PRESIDENT OF OLD COLONY CONSTRUCTION INDICTED IN RELATED CASE ON FRAUD AND MONEY LAUNDERING CHARGES

Boston, MA... The former Vice President of Construction at National Amusements, a national theater chain headquartered in Dedham, Massachusetts, pleaded guilty today in federal court to mail fraud and filing a false tax return.

United States Attorney Michael J. Sullivan; William Chase, Acting Special Agent in Charge of the Federal Bureau of Investigation in New England, and Joseph A. Galasso, Special Agent in Charge of the U.S. Internal Revenue Service, Criminal Investigation, announced that PETER J. BRADY, age 65, of Milton, pleaded guilty before U.S. District Judge Patti B. Saris to all counts of an Information charging him with subscribing to a false tax return in 1999 and defrauding his employer, National Amusements.

According to the Information, the charges against BRADY stem from the huge financial benefits he received from Old Colony Construction Company, one of National Amusements' general contractors. In a separate indictment returned in October, 2002, JOSEPH DESOUSA, the president of Old Colony Construction, was charged with eight counts of mail fraud and four counts of money laundering arising out of his relationship with BRADY. DESOUSA, age 42, formerly of Arlington and Marston Mills, Massachusetts and who now lives in Circencester, England, was arrested on December 21, 2002 at Logan International Airport when he traveled back to the Boston area for the holidays. DESOUSA is currently being detained in federal custody.

At today's plea hearing, the prosecutor told the Court that had the case proceeded to trial, the evidence would have proven that BRADY, as National Amusements' Vice President of Construction, had wide authority to award multi-million dollar contracts for the construction of new theaters and to approve payments under those contracts. National Amusements owns and operates approximately 1,400 movie theaters in the United States and abroad, with many operating under the name, "Showcase Cinemas." National Amusements awarded approximately $30 million in construction contracts to Old Colony between 1997 and 2001.

During this same time period, BRADY received approximately $1.5 million worth of free construction services, gifts and landscaping at his Milton home, and at three other properties owned by him or family members. For example, Old Colony purchased and installed $250,000 worth of imported kitchen cabinets in BRADY's home, installed a new kitchen in BRADY's house, constructed a putting green in his yard, renovated his basement, provided custom-tailored clothes and completed extensive renovations on his daughter's home in Milton.

BRADY falsified his tax return by not reporting all the services he was receiving from Old Colony. BRADY also pleaded guilty to defrauding National Amusements of his honest services by virtue of the fact that he was receiving huge financial benefits from one of National Amusements' main contractors.

"This case is representative of the excessive greed that is the driving force for most acts of corporate fraud," stated U.S. Attorney Sullivan. "This office is committed to ferreting out this type of criminal conduct and holding corporate executives accountable when they break the law to line their own pockets."

The Indictment charging DESOUSA alleges that he defrauded National Amusements by fabricating and inflating invoices that he submitted on National Amusements projects in order to cover the costs of all the work he was doing on BRADY's home. In one instance, the Indictment alleges, DESOUSA instructed a sub-contractor to dig and then re-pave a shallow trench in a parking lot in order to make it appear that the lot's drainage system had been repaired. DESOUSA then billed National Amusements as if the full repair work had been completed.

DESOUSA is also charged with money laundering based on his dealings with a sub-contractor who performed excavation work at Showcase Cinemas 16-screen complex in Randolph. According to the Indictment, DESOUSA submitted false requisitions to National Amusements for this excavation work, representing that this sub-contractor was owed inflated sums. The Indictment alleges that DESOUSA paid the sub-contractor over $3 million, but then demanded that the sub-contractor give $870,000 back to Old Colony. These transactions, according to the Indictment, were designed to conceal the fact that National Amusements' money was actually going directly to Old Colony.

Judge Saris scheduled BRADY's sentencing for April 11, 2003 at 2:00pm. BRADY faces up to 5 years' imprisonment and a $250,000 fine on each of the four counts of mail fraud. He faces up to 3 years imprisonment and a $100,000 fine on the tax charge.

If convicted, DESOUSA faces 20 years' imprisonment and a $500,000 fine on each of the money laundering charges, as well as 5 years' imprisonment and a $250,000 fine on the mail fraud charges.

The case was investigated by the U.S. Internal Revenue Service, Criminal Investigation and the Federal Bureau of Investigation. It is being prosecuted by Jonathan L. Kotlier, Chief of Sullivan's Economic Crimes Unit and Assistant U.S. Attorney Joshua S. Levy also in Sullivan's Economic Crimes Unit.

Press Contact: Samantha Martin, (617) 748-3139