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From Volume 4, Issue Number 48 of EIR Online, Published Nov. 29, 2005

Fitzgerald Indicts Neo-Con Piggy Bank Conrad Black on Fraud

Special to New Federalist

Nov. 25 (EIRNS)—Patrick Fitzgerald, the no-nonsense Special Prosecutor in the "Plamegate" case, in his other capacity as U.S. Attorney for the Northern District of Illinois has indicted neo-con piggy-bank Conrad Black and other former top executives of the Hollinger International, Inc. (HII) media empire on Federal fraud charges. The indictment, unsealed on Nov. 17, supersedes an August 2005 indictment that charged Black, who formerly headed the international corporation, and others with fraudulently diverting more than $32 million from the U.S.-based holding company, Hollinger International Inc.

Looting the Company

As this newspaper has reported in articles going back as far as 2003, the misuse of Hollinger funds by Black included buying up neo-con thinktanks and publications in the U.S. that have promoted the agenda of the Dick Cheney-led policy cabal that controls the Bush Administration. EIR also reported that "Prince of Darkness" Richard Perle, a leading neo-con mouthpiece and former member of the Defense Policy Board, as president of one of HII's spinoffs got some of Black's questionable funds.

The August 2005 charges were brought against F. David Radler (former publisher of Hollinger's Chicago Sun-Times), Chicago attorney Mark S. Kipnis (an officer of HII) and Toronto attorney Peter Y. Atkinson (an officer of Hollinger International and of Canada's Hollinger, Inc.). Radler pleaded guilty to a fraud count and is cooperating in the ongoing investigation.

The new 11-count indictment realleges the original fraud scheme, and adds two new fraud schemes and three new defendants. One alleged fraud concerns diversion of $51.8 million in 2000 from HII's multibillion-dollar sale of assets; the second fraud concerns misuse of corporate perks. The new defendants, in addition to Black, are the Ravelston Corporation Ltd. (a Canadian company based in Toronto, now in bankruptcy proceedings, which had 98.5% of its equity owned by officers and directors of HII and HI with Black as the controlling shareholder), and John A. Boultbee (an officer of HII, HI, and Ravelston).

Hollinger ousted Black as its chairman and CEO in 2003, and then filed a $1.3-billion RICO civil suit in 2004 against Lord Black and Radler, vice-chairman, president, and chief operating officer of HII. That suit charges that they broke their fiduciary duties to other shareholders, through their looting schemes. The suit further charges that "the Black Group used Hollinger as a cash cow to be milked of every possible drop of cash."

In a report to the Securities and Exchange Commission on Aug. 30, 2004, HII described how Hollinger was systemically manipulated and used by its controlling shareholders for their sole benefit, and in a manner that violated every concept of fiduciary duty. The report stated that 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.

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