Investigators Tell Story of Ex-CEO's Looting of Hollinger Millions

Conrad BlackConrad Black, the former CEO of Hollinger International, boldly and methodically abused his power to pocket millions of dollars that should have gone to the company, an internal investigation revealed.

Three outside Hollinger directors prepared the dramatic, 500-page report, filed with the Securities and Exchange Commission on Tuesday. "This story is about how Hollinger was systematically manipulated and used by its controlling shareholders for their sole benefit, and in a manner that violated every concept of fiduciary duty,” the committee wrote in its introduction.

The investigation was sparked by shareholder concerns about payments Black and others received, and the probe revealed that they looted 95 percent of the company's earnings from 1997 to 2003, or more than $400 million, the Associated Press reported.

The committee is suing Black, former chief operating officer David Radler and others for $1.25 billion in damages in federal court, where they are accused of racketeering.

The committee said of Black and Radler, "Behind a constant stream of bombast regarding their accomplishments as self-described 'proprietors,' Black and Radler made it their business to line their pockets at the expense of Hollinger almost every day, in almost every way they could devise.”

The report was also critical of the performance of the company's audit committee, which was "ineffective and careless over a prolonged period of time." Richard Perle, a former defense adviser and a member of Hollinger International's board, "repeatedly breached his fiduciary duties” by signing papers without reading them, the report said.

Black retains voting control of Hollinger International through Hollinger Inc., the Toronto-based parent company, which revealed Monday that the SEC's Midwest regional office planned to recommend civil charges be filed for alleged violations of the Securities and Exchange Act.

Hollinger International owns the Chicago Sun-Times and several other newspapers in the Chicago area, where the company is based.

You may like these other stories...

Here's a CPA who truly walks the walk. On March 15, Frank Ryan, CPA, departed San Diego, California, with plans to be in Ocean City, Maryland, by July 2 to teach a course at the Maryland Association of CPAs’ (MACPA...
When Theodore J. Flynn first joined the Massachusetts Society of CPAs (MSCPA) in 1970, it was a different world and a different profession.  The "Big Eight" were still headquartered in Boston. Vietnam War...
Accountant Rickey Charles Goodrich had it a little too good. Many bean counters would kill to serve as financial guru to the likes of Pearl Jam. Goodrich was hired in 2005, and the following year, he became the CFO of Curtis...

Upcoming CPE Webinars

Jul 16
Hand off work to others with finesse and success. Kristen Rampe, CPA will share how to ensure delegated work is properly handled from start to finish in this content-rich one hour webinar.
Jul 17
This webcast will cover the preparation of the statement of cash flows and focus on accounting and disclosure policies for other important issues described below.
Jul 23
We can’t deny a great divide exists between the expectations and workplace needs of Baby Boomers and Millennials. To create thriving organizational performance, we need to shift the way in which we groom future leaders.
Jul 24
In this presentation Excel expert David Ringstrom, CPA revisits the Excel feature you should be using, but probably aren't. The Table feature offers the ability to both boost the integrity of your spreadsheets, but reduce maintenance as well.