Black Trial Told of Hollinger Counsel's Payments Memo

29 March 2007

CHICAGO: Following testimony earlier this week about payments made to Hollinger International [H-Int] executives, the fraud trial of Lord Conrad Black and three former associates, heard evidence from a lawyer who had been asked to deposit $4.5 million (€3.37m; £2.29m) in Black's bank account.

Tom Henson, who worked for Community Newspaper Holdings when it bought a swathe of titles from H-Int, told the court he refused to agree to the transaction because he did "not feel comfortable wiring money to individuals I did not know from Adam's house cat".

He told the court that on the day the deal closed he was asked to send a total of $9.5m in non-competition payments to the personal accounts of Lord Black and three other executives.

The request had come from David Radler - who is expected to be a star prosecution witness and has already pleaded guilty to one count of fraud.

Henson refused to make the personal payments, saying the initial contract for the sale had not included them.

Black (with former H-Int counsel Mark Kipnis, ex-evp Peter Atkinson and erstwhile finance chief John Boultbee) are accused of diverting into their own pockets $60m that should have gone to H-Int shareholders, say prosecutors. The accused quartet denies the charges.

Prosecutor Eric Sussman also read out a memo in which Kipnis directed that $9.5m be disbursed to Black and Radler, in checks for $4.3m each, and to Atkinson and Boultbee, for $450,000 each. Kipnis also wrote he was entitled to a $100,000 bonus.

The trial continues.

Data sourced from New York Times/Bloomberg News; additional content by WARC staff