THE DISSENT

[SPIN]

Conrad Black Stole $60 Million From Hollinger, U.S. Prosecutor Claims



By Andrew Harris and Bob Van Voris

March 20 (Bloomberg) -- Conrad Black used his position as chief executive officer of Hollinger International Inc. to steal almost $60 million from the company, a U.S. prosecutor said at the start of Black's fraud and racketeering trial.

Assistant U.S. Attorney Jeffrey Cramer today began laying out the government's fraud case against Black and three other former Hollinger executives in federal court in Chicago.

``Bank robbers wear masks and use guns,'' Cramer told the jury in his opening statement. ``These four men used lawyers and accountants and wore ties and a suit.''

Prosecutors claim that Black, 62, used Hollinger, once the third-biggest English-language newspaper publisher, as his personal ``piggy bank'' and that he and others stole from the company during a sell-off of almost $3 billion in company assets from 1998 to 2001.

Black is charged with racketeering, obstruction of justice, money laundering and mail, wire and tax fraud. If convicted, he may spend the rest of his life in prison. Hollinger, which once owned the Chicago Sun-Times, London's Daily Telegraph and the Jerusalem Post, changed its name to Sun-Times Media Group Inc. last year.

Black's lawyers have maintained their client's innocence, saying nothing he did violated the law.

Also charged in the case are John Boultbee, Hollinger's former chief financial officer; Peter Atkinson, a former executive vice president; and Mark Kipnis, Hollinger's former general counsel. All have pleaded not guilty to multiple counts of wire fraud, mail fraud and tax fraud.

First Witness

After prosecutors finish their opening arguments today, they will be followed by lawyers for Black and his co-defendants. The first witness for the prosecution will be Gordon Paris, who took over as Hollinger's interim chief executive officer after Black was forced to step down in 2003.

Opening statements were delayed one day after defense attorneys told U.S. District Judge Amy St. Eve they were worried that news reports of legal settlements by a prosecution witness may have tainted the jury.

David Radler, Hollinger's former president and chief operating officer, agreed last week to pay $72 million to settle claims by Sun-Times Media Group and the U.S. Securities and Exchange Commission.

Radler, who was Black's business partner for more than 35 years, pleaded guilty to fraud in September 2005. He agreed to cooperate with prosecutors in return for a recommendation that he serve 29 months in prison and pay a $250,000 fine. Radler is expected to testify during the trial.

St. Eve initially told the lawyers she would question the jurors individually and in chambers to learn if they had heard or read accounts of the Radler settlements. Two hours later, her clerk announced the trial's start would be postponed for a full day, without further explanation.

Joel Daly, a spokesman for the court, declined to comment on the reasons for the delay. Randall Samborn, a spokesman for Chicago U.S. Attorney Patrick Fitzgerald also declined to comment, as did lawyers for Black and Boultbee.

Lawyers say the trial may last three months.

The case is U.S. v. Black, 05cr727, U.S. District Court, Northern District of Illinois (Chicago).

To contact the reporters on this story: Andrew Harris at the federal courthouse in Chicago at 5474 or [e-mail] ; Bob Van Voris at the federal courthouse in Chicago at 5474 or [e-mail] .
Last Updated: March 20, 2007 10:59 EDT

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