A US federal grand jury in Chicago on Thursday issued a seven-charge fraud indictment against two former executives of Hollinger International: F David Radler and Mark S Kipnis, respectively ex-president/chief operating officer and ex-vice president, corporate counsel.

The indictment also names Ravelston Corporation, a tightly held Canadian holding company controlled by Radler and former Hollinger International chairman/ceo Lord Conrad Black.

The latter is not named in respect of the charges, which allege that Radler and Kipnis were responsible for a series of complex transactions that diverted more than $32 million (€26m; £18m) from the Chicago newspaper publisher.

The indictment also charges that the named pair, along with Ravelston, "cheated public shareholders in the US and Canada," and at the same time deprived Canadian tax authorities of tax revenue.

According to Patrick J Fitzgerald, US attorney for the Northern District of Illinois, Radler is "cooperating with the investigation and expects to enter a plea of guilty at a later date."

However, Fitzgerald's lips remained zipped as to whether the government will bring charges against Black. This appears to be a likely scenario given that Radler is ready to sing. A spokesman for Lord Black declined comment.

Fitzgerald said his investigation had been aided, not only by a cooperative Radler, but also by the Securities and Exchange Commission, the Federal Bureau of Investigation and the detailed report of a Hollinger board investigation.

His Lordship and squire Radler resigned as Hollinger International's top duo in November 2003 after the company accused them of receiving $32 million of unauthorized payments.

Data sourced from Wall Street Journal Online; additional content by WARC staff