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This article originally published by the Times of London (this day), which was a oh either a competitor or owned by Conrad of Doublecross Harbour. Anyway to know him... and all that.
Black portrays himself as a victim
The Hollinger boss claims that he was taken in by a ‘web of deceit’, reports Tom Bower from the trial in Chicago
WITH obvious distaste throughout the first week of his trial, Lord and Lady Black have silently entered the 12th-floor Chicago courtroom appearing like outsiders at their own party. Walking past dozens of journalists whom Barbara Amiel characterised in a courthouse lift as “vermin” and facing a jury described as “working class, meat-and-potato folk” — a class the two social aristocrats have always disdained — the Blacks seem bereft of much comfort.
The odds, they know, are stacked against his acquittal. No less than 95% of federal prosecutions for fraud in the city end in conviction, and he faces 17 charges, including racketeering and obstruction of justice with a maximum sentence of 101 years in prison.
After their marriage in 1992, the Blacks had gleefully posed as an A-list power couple, travelling on their corporate Gulf-stream jet between their four sumptuous homes and mixing with billionaires, power brokers and politicians. Neither imagined the current scenario of humiliation and financial ruin. Nor did they calculate that their lifestyle, financed by Hollinger International’s public shareholders, would become the subject of a criminal trial where her confession — “now I have an extravagance that knows no bounds” — would be mercilessly regurgitated.
Conrad Black is accused of stealing more than $60m (£31m) from Hollinger by helping himself to money assigned as noncompete payments in the contracts to sell most of Hollinger’s newspaper empire after 1998. He is also accused of spending $40,000 of Hollinger’s funds on Amiel’s 60th birthday party in New York for 80 friends, of spending $250,000 by using Hollinger’s jet to fly on holiday to Tahiti with Amiel, and of swindling the company of about $3m in a swap of apartments in Manhattan. In the prosecution’s words, Hollinger was transformed by Black into his personal “piggy-bank” or the “Bank of Conrad Black”.
In his opening statement, Ed Genson, one of Black’s lawyers, dismissed the “perks” as consistent with a tycoon’s life. “His private life is his business life,” said Genson. Portraying Black as “a family man and a master of language who did everything by the book”, Genson admitted that Black’s self-incriminatory e-mails where he speaks disdainfully about shareholders and is unapologetic about using Hollinger’s money for his personal lifestyle show him as “snotty” and arrogant but, he insisted, not a thief.
“Other than a bad attitude you’re not going to find a single thing that’s wrong,” said Genson. “He was not stealing for himself. The company was stolen from him.” Establishing Black as a victim of theft is a fascinating undertaking.
The “thief”, according to Black, is David Radler, Black’s partner since 1969. Together they built the world’s third-larg-est newspaper company. According to Genson, the two partners split their newspaper empire, isolating themselves from each other.
While Radler ran the business in Israel, America and western Canada, Black was responsible for eastern Canada and Britain. Allegedly, neither spoke to the other about their own activities. “And just as the companies were run,” said Genson, “they were also sold.” In other words, Black was allegedly ignorant about all the sales and the phoney noncompete payments that Radler negotiated as the newspapers were disposed of.
In return for a 29 months’ imprisonment and a $250,000 fine, Radler has admitted one crime and agreed to testify against Black and his three codefendants. Radler has also paid about $100m in fines and compensation to Hollinger.
Just how Black will successfully pose as the ignorant victim of his partner intrigues the prosecution. After all, he was chairman, chief executive, a major shareholder and exercised the majority of voting rights. Repeatedly, in e-mails and conversations, he called Hollinger “my company” and described himself as the “proprietor”. Although more than $100m poured into his personal bank account from illegal deals, Black claims that he never closely questioned Radler about the source of the money.
Black, Genson told the jury, was Radler’s victim. “Radler spun a web of deceit,” said Genson and, to save himself from 30 years’ imprisonment, “cut a deal to end all deals . . . by dishing Conrad”. However, in his autobiography Black repeated 33 times how Radler was a close friend and partner with whom he shared every thought.
The first witness to undermine the defence was Gordon Paris, a banker recruited by Black in May 2003 as a director of Hollinger to reassure irate shareholders about Black’s honesty.
Paris testified: “Conrad Black was quite knowledgeable about Hollinger’s finances . . . Black had effective control of Hollinger.”
In June 2003, Paris ordered a special committee of directors to investigate Black’s conduct. In November 2003 they reported that Black had masterminded “corporate kleptocracy”, pocketing with Radler and others about $400m, or 73% of the company’s net income over six years.
Black and his codefendants have so far prevented the jury hearing the report’s damning conclusions. But in the internet age, it is likely that some jurors will, contrary to the judge’s orders, read the report.
In court, Black wanted to accuse Paris of outrageously enriching himself and wrecking the company. His lawyers squeezed into the record that Paris did at one stage earn $15,805 a day and feathered his nest by replacing Black as Hollinger’s chief executive and chairman.
The conclusive evidence of Paris’s greed, suggested Black’s lawyer, was a dinner on November 13, 2003, at Le Cirque — “one of New York’s most expensive restaurants”. Paris shot back: “That was only for Hollinger directors. We were talking business.” The topic was Black’s dismissal for dishonesty. Black has waited ever since that dinner to exact revenge.
The characterisation of that dinner as a “perk” provoked the prosecution.
“When you were at Le Cirque at Hollinger’s expense,” Eric Sussman, the prosecutor, asked Paris, “were you celebrating a birthday? Was there an opera singer? And was there a pianist?”
Sitting close to her husband, dressed in a black suit and a Chanel scarf, Amiel lent forward, noticeably tense. Conrad Black’s face flushed.
“No,” replied Paris. To intensify the Blacks’ embarrassment, Sussman continued: “And did you charge to Hollinger any clothes and tips for doormen?”
Amiel sank back in her chair. Notoriously, despite receiving an income of $1.45m from Hollinger, Amiel had charged the company $20 for a tip to the doorman of Bergdorf Goodman, the fashion store on Manhattan’s Fifth Avenue.
“No sir,” replied Paris. All those perks will emerge during the trial, which promises to be ferocious and dirty.
Before leaving Toronto, Black promised to destroy his accusers. The lust for blood is shared by his young prosecutors. Their careers depend on convictions.
Over the next four months, neither side will show mercy or magnanimity. Conrad Black has declared that this is a fight to the death, and nobody disagrees.
Tom Bower is the author of Conrad and Lady Black, published by Harper Press
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