Black's Delaware Testimony Reawakens SEC Interest

26 February 2004

The interest of America's Securities and Exchange Commission in the labyrinthine doings of Lord Conrad Black of Crossharbour may have been reawakened by the peer's recent testimony in a Delaware courtroom.

Black agreed to testify on his own behalf in last week's legal joust to determine if he is free to sell his privately held company Hollinger Incorporated [H-Inc] -- and crucially its 73% voting interest in Hollinger International [H-Intl] -- to the clamlike British Barclay twins [WAMN: 23-Feb-04].

Although the outcome of the hearing is not yet known -- Judge Leo Strine will rule by February 27 -- Black's willing appearance on the Delaware stand may invalidate his right to plead the Fifth Amendment (not to testify), a right he successfully invoked last December when the SEC launched an investigation into his Hollinger newspaper publishing empire.

Sources close to the SEC say the regulator may now serve Black with second subpoena on grounds that his Delaware testimony effectively waived his right to take the Fifth.

Comments University of Delaware corporate governance expert Charles Elson: "Any time a potential target of a government probe testifies, there are risks there. That's why typically you . . . take the fifth . . . You have to be quite careful,"

A spokesman for the peer declined to offer comment on His Lordship's behalf.

Data sourced from: Financial Times; additional content by WARC staff