TBO.com - TBO is Tampa Bay Online

Former Newspaper Mogul Gets 6-Year Term In Fraud Case

ADVERTISEMENT

By MIKE ROBINSON, The Associated Press

Published: December 11, 2007

CHICAGO - Former newspaper mogul Conrad Black was sentenced Monday to 6 1/2 years in prison, far less than prosecutors sought, for swindling shareholders in his Hollinger media empire out of $6 million.

"Mr. Black, you have violated your duty to Hollinger International shareholders," U.S. District Judge Amy J. St. Eve told the millionaire member of the British House of Lords known in the newspaper industry for his lavish lifestyle and flamboyant use of words.

Prosecutors had asked for up to 30 years in prison for the Canadian-born Black, saying he had not shown "one shred of remorse" for looting the company that once owned the Chicago Sun-Times, Daily Telegraph of London, Jerusalem Post and hundreds of U.S. and Canadian community newspapers.

"Obviously, there's a great deal of relief" at the lighter-than-expected sentence, said Black's attorney, Jeffrey B. Steinback, who delivered a passionate appeal for leniency.

Black, currently at his Palm Beach estate on $21 million bail, has until March 3 to report to prison. St. Eve recommended the federal correctional center at Eglin Air Force Base in the Florida Panhandle.

"Mr. Black will be moving from Palm Beach to Eglin and anyone who has ever heard of either one knows that's a serious change in life conditions," U.S. Attorney Patrick J. Fitzgerald told reporters.

Within an hour of the sentencing, officials said the Eglin correctional facility requested by Black had been closed.

'A Serious Amount Of Time'

Fitzgerald, asked about the lighter-than-expected sentence, said, "Mr. Black is going to jail as a convicted felon, convicted of fraud. So we proved the case. The bottom line is Mr. Black will do 6 1/2 years in jail. That's a serious amount of time."

Black left the courthouse without commenting.

Defiant to the end, he told the court his main regret as he faces prison was not what happened when he was running Hollinger but "the evaporation of $1.5 billion of shareholder value under my successors."

Black's wife, conservative columnist Barbara Amiel Black, and daughter Alana were in court when he was sentenced.

St. Eve said three factors led her to impose a sentence of 78 months. She rejected the prosecutors' claim that Black should be held responsible for $32 million in shareholder losses. She held him responsible for $6 million - which lowered the potential sentencing range.

Sentencing Aligned With Partner's

St. Eve also said Black's sentence should be closer to that of F. David Radler, his ex-business partner, the government's star witness at the four-month trial. Under a plea agreement, Radler will get a 29-month sentence and $250,000 fine.

Radler also is expected to serve much of his time in a Canadian prison, where sentences for nonviolent offenders often are cut further.

After sentencing Black, St. Eve began sentencing three co-defendants who were convicted with him: Canadian executives John Boultbee and Peter Atkinson and Chicago attorney Mark Kipnis.

They originally were charged with swindling shareholders out of an estimated $60 million by collecting payments from purchasers of Hollinger's U.S. and Canadian newspapers. The payments were in exchange for promises not to return and compete with the papers' new owners.

Black was acquitted of nine of counts, including racketeering, and convicted of siphoning off $6 million through bonuses disguised as such "noncompete" payments. Black also was convicted of obstruction of justice for removing documents from his offices.

Defense attorneys pleaded for lenience, showing letters from such celebrities as Sir Elton John, conservative writer and TV personality William F. Buckley Jr., former Canadian Prime Minister Brian Mulroney and columnist George Will, describing Black as someone who had devoted much of his life to helping charities and those around him.

But shareholder Eugene Fox, managing director of Connecticut-based Cardinal Capital Management Co., gave a victim-impact statement urging St. Eve to punish Black in a way that would warn other executives not to defraud the shareholders. He said Black showed contempt for shareholders. "He called us idiots and greedy fools," Fox said.

Attorney Andrew Frey, hired to head the appeal, said he is optimistic about Black's chances but added the sentence was daunting. "For a 63-year-old man, 6 1/2 years is a lot of time to spend, especially if you don't feel you've committed a crime," he said.

Share this:

Loading Comments...

Email Print

ADVERTISEMENT