Former Publishing Tycoon Indicted on Charges of Fraud
Conrad Black, who once controlled the Hollinger International media empire, was charged Thursday along with three other executives of looting millions of dollars from the company, cheating on taxes and dipping into corporate coffers to finance his lavish lifestyle.
“What has gone on here is the grossest abuse by directors and insiders,” U.S. Atty. Patrick J. Fitzgerald said in unveiling the 11-count indictment.
An arrest warrant was issued for the 61-year-old Black, a former Canadian citizen who is now a member of the British House of Lords. Fitzgerald said that if Black fails to appear before U.S. District Judge Amy St. Eve to answer the charges, the government would seek to have him extradited.
Hollinger International Inc. owns the Chicago Sun-Times and other publications in the U.S. and Canada. It formerly controlled the Daily Telegraph of London and the Jerusalem Post.
The indictment charged that Hollinger International’s $2.1-billion sale of several hundred U.S. and Canadian publishing properties was rife with fraud.
Black’s attorney, Gregory Craig, could not be reached for comment immediately.
Molly Morse, a spokeswoman for Hollinger International, said the company had no comment on Thursday’s indictments. Hollinger Inc., the Toronto-based holding company that has voting control over Hollinger International, also declined to comment.
Black also was charged with defrauding Hollinger through bogus non-compete agreements.
The indictment said he used a similar bogus agreement to siphon $51.8 million out of Hollinger International’s multibillion-dollar sale of assets in 2000 to CanWestGlobal Communications Corp.
In addition, the indictment said that Black used company cash to bankroll a lifestyle that included Park Avenue apartments in New York and a vacation in Bora Bora in French Polynesia.
It said Black and his wife used a corporate jet to fly to Bora Bora in July 2001 and remained there for a week. When company auditors asked him to reimburse them for the travel, he told them “no such outcome is acceptable,” the indictment said.
According to the indictment another defendant, John A. “Jack” Boultbee, 62, of Toronto swindled Hollinger International out of millions of dollars by having the company pay for the renovation of one Park Avenue apartment for Black’s servants and buying another Park Avenue apartment from the company at far below the fair price.
Besides Black and Boultbee, those charged are Peter Y. Atkinson, 58, a Canadian attorney, and Mark S. Kipnis, 58, of Northbrook, Ill., who served as secretary to Hollinger International’s board of directors when the board was approving some of the agreements. Kipnis was charged with fraud in August. He has pleaded innocent and was reindicted Thursday.
