Black's fall from grace triggered by Enron affair

Conrad Black, the former Hollinger International chairman convicted of mail fraud and obstructing justice, led the media group for eight years as chairman and chief executive officer. Black (63) quit as chief executive in 2003 after an internal probe found he and other executives got more than $32 million (€21.8 million) in unauthorised payments.

He was fired as chairman two months later and convicted in July this year of directing a $6.1 million fraud.

His conviction stemmed from a federal crackdown on corporate crime that followed the 2001 collapse of Enron.

Black, 1.85m (6ft 1in), silver-haired and barrel-chested, is a member of Britain's House of Lords, with the title of Lord Black of Crossharbour. At its peak and under Black's command, Hollinger, now Sun-Times Media Group, was the world's third-largest publisher of English-language newspapers, including the Chicago Sun-Times, London's Daily Telegraph, Canada's National Post and the Jerusalem Post.

Black was charged in November 2005. On July 13th this year, a jury found him and three former subordinates guilty of fraud stemming from $6.1 million in cheques paid to three defendants in exchange for sham non-competition agreements involving Hollinger. Black was convicted of obstruction of justice for removing 13 boxes of documents sought by regulators from his Toronto office in 2005. He was found not guilty of racketeering, tax charges and five wire and mail fraud counts.

Defence lawyer Jeffrey Steinback told district judge Amy St Eve, who presided over the trial, that the six-and-a-half year prison term received by Black constituted "life without parole" for the 63-year-old. "This case is not like Enron or WorldCom," the attorney said. "No bank robbers ever built the banks that they robbed." Black was the largest shareholder in Hollinger, he added. "His fate was wrapped up in" the company," Steinback argued.

The US government argued the defendants were responsible for the theft of at least $32 million from Hollinger. Judge St Eve rejected that calculation before sentencing. The judge ruled that fairness dictated that she sentence Black under the same 2000 federal guidelines used to sentence his chief accuser, ex- Hollinger president F David Radler.

"Radler was the one who was ordering the money and telling others where it should be disbursed," Judge St Eve said, adding Radler was "calling just as many shots." Prosecutors had asked her to use tougher guidelines approved last year. Gene Fox, chief executive officer of Cardinal Capital Management, a former Hollinger shareholder, told the judge in a victim impact statement that non-compete payments weren't properly disclosed, and shareholders needed accurate financial information.

"Stocks would become no better than lottery tickets" without accurate information, Fox said. "They lied to us repeatedly."

Convicted with Black were former Hollinger vice-president Peter Atkinson, ex-chief financial officer John Boultbee, and former general counsel Mark Kipnis. All three men are scheduled to be sentenced later today.