Business

Jury convicts British lord of fleecing newspaper empire

CHICAGO - Former media mogul Conrad Black was convicted Friday of swindling the far-flung Hollinger International newspaper empire he once ran out of millions of dollars, becoming the latest in a wave of disgraced corporate executives to face prison time for financial fraud.

Black, 62, who once renounced his Canadian citizenship to become a member of the British House of Lords, was found guilty by a federal jury of three counts of mail fraud and one count of obstruction of justice for spiriting documents out of his Toronto office in defiance of a court order.

Black was acquitted of nine other counts ranging from tax fraud to the most serious charge - racketeering. He was also acquitted of fleecing Hollinger shareholders through such perks as taking the corporate jet on a two-week vacation to the island of Bora Bora.

The three-month trial drew international media attention, heightened by the silver-haired British lord's posh lifestyle and sometimes haughty comments. When shareholders grumbled about the cost of the Bora Bora trip, he wrote a memo saying: "I'm not prepared to re-enact the French revolutionary renunciation of the rights of the nobility."

Three other former Hollinger executives, John Boultbee, 65, of Victoria, British Columbia; Peter Y. Atkinson, 60, of Oakville, Ontario; and Mark Kipnis, 59, of Northbrook, Ill.; were also convicted of fraud charges.

Prosecutors asked U.S. District Judge Amy St. Eve to have Black jailed immediately, saying he could face approximately 15 years to nearly 20 years in federal prison for the conviction. But defense attorneys said the actual sentence was likely to be much less.

In contrast to the $84 million in fraud prosecutors blamed on Black when he was indicted two years ago, the jurors found him guilty of a fraction of that - defense attorneys put the amount at $3.5 million.

Still, U.S. Attorney Patrick Fitzgerald said the government was "gratified" by the verdict.

"We think the verdict vindicates the serious public interest in making sure that when insiders in a corporation deal with money entrusted to them by the shareholders, that they not engage in self-dealing, that they not break the law to benefit themselves instead of the shareholders," Fitzgerald said.

St. Eve set a Nov. 30 sentencing date, confiscated Black's passport and ordered him to remain in the Chicago area while she considers the government's request that she revoke his $21 million bond, partly secured by a seaside estate in Palm Beach, Fla. A hearing on the bond issue is scheduled for Thursday.

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