Feds want media mogul and pals to forfeit $16.95 million

Former media mogul Conrad Black and two other executives convicted of swindling the Hollinger International newspaper empire should forfeit $16.95 million, federal prosecutors said Monday.

In court papers filed with U.S. District Judge Amy J. St. Eve, prosecutors said the big newspaper holding company had lost $32.15 million through seven fraudulent deals engineered by Black and his co-defendants.

They said Black, 62, as well as former Hollinger executives Peter Y. Atkinson, 60, of Oakville, Ontario, and John Boultbee, 65, of Victoria, British Columbia, should be required to jointly forfeit $16.5 million.

Whatever amount the defendants forfeit will come on top of hefty fines that St. Eve could impose at the sentencing, which is set for Nov. 30.

Prosecutors said after the verdict that Black could face 15 to 20 years in federal prison. Defense attorneys said they believed that the actual sentence imposed by St. Eve would end up being considerably lower.

Prosecutors also said Monday they will file papers with the court later outlining how much they believe that a fourth defendant who was also convicted, Chicago attorney Mark Kipnis, should be required to forfeit.

Kipnis, 59, of suburban Northbrook was convicted of helping the three other defendants, all from Canada, in engineering the fraud scheme. But he was not accused of pocketing money belonging to Hollinger's shareholders.

Lead attorneys in the case, Edward M. Genson and Edward L. Greenspan for Black, Patrick Tuite for Boultbee and Benito Romano for Atkinson, were not reached for comment Monday night after the court papers were filed.

Messages were left at all of their offices.

All four defendants were convicted of three counts of mail fraud constituting a scheme under which money belonging to Hollinger International was allegedly siphoned off through the sale of assets.

Black and his fellow executives, including F. David Radler, for years the No.2 man in his newspaper empire and now a government witness, got millions of dollars in so-called non-compete payments from companies that bought Hollinger-owned community newspapers across the United States.

In return for the money, the defendants promised that they would not return to the circulation areas of the newspapers and compete with the new owners. Such payments are common in the industry but the federal government said that the money should have gone to Hollinger shareholders.

In addition, Black was convicted of obstruction of justice for carting documents out of his Toronto offices in defiance of a court order.

St. Eve has allowed Black to remain free on $21 million bond pending his sentencing but he must remain either in the Chicago area or at his estate in Palm Beach, Fla. She refused to allow him to return to Canada.