The US Securities and Exchange Commission (SEC) filed a lawsuit accusing the newspaper tycoon Conrad Black and his former top deputy of defrauding the shareholders of Hollinger International Inc, a publishing company Black used to run.
In a suit filed on Monday in federal court in Chicago, where Hollinger International is based, the SEC accused Black and David Radler of siphoning money from the company to themselves and then misleading the company's board about the transactions.
Stephen Cutler, the SEC's head of enforcement, said the two men "abused their control of a public company and treated it as their personal piggy bank."
Hollinger publishes the Chicago Sun-Times and The Jerusalem Post. Until recently it also owned The Daily Telegraph of London.
The suit adds to Black's legal troubles. He is already being sued by his own company for the recovery of money they say he improperly diverted to himself and his associates. That lawsuit makes broader accusations against Black and claims that he caused more than US$500 million in damages to the company.
The SEC's case focuses on a narrower set of transactions. It seeks civil penalties against Black and an order barring him and Radler from serving as officers or directors of public companies. The SEC also wants Black's voting shares of Hollinger International placed in a trust.
Black has been removed as chairman and CEO of Hollinger International after an internal investigation found that he and his associates schemed to siphon away millions of dollars in company funds. He remains the company's controlling shareholder, however.
No criminal charges have been made against Black. Merri Jo Gillette, the director of the SEC's Midwest Regional Office, noted that in a civil fraud case the SEC need only prove that the defendant knew or should have known that the conduct he was engaging in was fraudulent, as opposed to a criminal case were guilt must be proved beyond a reasonable doubt.
A special committee of Hollinger International's board of directors is suing Black and his associates to recover what they say are hundreds of millions of dollars that were improperly diverted. That lawsuit also names company director Richard Perle as a defendant, alleging he breached his fiduciary responsibility. Perle is a commentator on defense issues and a former US assistant secretary of defense.
Black and Radler have denied any wrongdoing. Black did not respond to repeated requests for comment, but a privately-held Canadian company he controls, Ravelston Corp, issued a statement late Monday saying that "we expect to be fully vindicated in this fight." A spokesman for Radler said he would defend the charges in court.
In its suit, the SEC accuses Black and Radler of several instances of self-dealing, including diverting money to themselves as part of the sale of several newspapers; of orchestrating the sale of several newspapers from Hollinger to a privately held company controlled by Black and Radler at below-market prices; and of misleading the company's board regarding the transactions.
‘WIN-WIN’: The Philippines, and central and eastern European countries are important potential drone cooperation partners, Minister of Foreign Affairs Lin Chia-lung said Minister of Foreign Affairs Lin Chia-lung (林佳龍) in an interview published yesterday confirmed that there are joint ventures between Taiwan and Poland in the drone industry. Lin made the remark in an exclusive interview with the Chinese-language Liberty Times (the Taipei Times’ sister paper). The government-backed Taiwan Excellence Drone International Business Opportunities Alliance and the Polish Chamber of Unmanned Systems on Wednesday last week signed a memorandum of understanding in Poland to develop a “non-China” supply chain for drones and work together on key technologies. Asked if Taiwan prioritized Poland among central and eastern European countries in drone collaboration, Lin
The Chien Feng IV (勁蜂, Mighty Hornet) loitering munition is on track to enter flight tests next month in connection with potential adoption by Taiwanese and US armed forces, a government source said yesterday. The kamikaze drone, which boasts a range of 1,000km, debuted at the Taipei Aerospace and Defense Technology Exhibition in September, the official said on condition of anonymity. The Chungshan Institute of Science and Technology and US-based Kratos Defense jointly developed the platform by leveraging the engine and airframe of the latter’s MQM-178 Firejet target drone, they said. The uncrewed aerial vehicle is designed to utilize an artificial intelligence computer
The Chinese Nationalist Party (KMT) caucus yesterday decided to shelve proposed legislation that would give elected officials full control over their stipends, saying it would wait for a consensus to be reached before acting. KMT Legislator Chen Yu-jen (陳玉珍) last week proposed amendments to the Organic Act of the Legislative Yuan (立法院組織法) and the Regulations on Allowances for Elected Representatives and Subsidies for Village Chiefs (地方民意代表費用支給及村里長事務補助費補助條例), which would give legislators and councilors the freedom to use their allowances without providing invoices for reimbursement. The proposal immediately drew criticism, amid reports that several legislators face possible charges of embezzling fees intended to pay
REQUIREMENTS: The US defense secretary must submit a Taiwan security assistance road map and an appraisal of Washington’s ability to respond to Indo-Pacific conflict The US Congress has released a new draft of the National Defense Authorization Act (NDAA), which includes up to US$1 billion in funding for Taiwan-related security cooperation next year. The version published on Sunday by US House of Representatives Speaker Mike Johnson removed earlier language that would have invited Taiwan to participate in the US-led Rim of the Pacific Exercise (RIMPAC). A statement on Johnson’s Web page said the NDAA “enhances U.S. defense initiatives in the Indo-Pacific to bolster Taiwan’s defense and support Indo-Pacific allies.” The bill would require the US secretary of defense to “enable fielding of uncrewed and anti-uncrewed systems capabilities”
RSS