David Radler, the former top deputy to disgraced newspaper baron Conrad Black, agreed yesterday to serve only 29 months in prison in exchange for cooperating with authorities investigating the massive fraud at Hollinger International.
Radler appeared in a Chicago court yesterday to plead guilty to one count of mail fraud for his role in bilking Hollinger International of $32 million. His sentencing was delayed to allow time for the criminal investigation of others involved in the fraud.
Black was never mentioned by name in the 33-page plea agreement unveiled yesterday – he was only referred to as the “chairman.” But the message was clear: Radler had become a turncoat and will help authorities put his former boss behind bars.
“This is the first step in making amends for what has taken place,” Radler’s attorney Anton Valukas said yesterday.
Radler was indicted on Aug. 18 after a lengthy criminal investigation into the financial shenanigans at Hollinger, the parent company of the Chicago Sun-Times. Indicted with Radler was Mark Kipnis, the former in-house lawyer for Hollinger, and Ravelston, a private company controlled by Black.
The scandal at the company erupted in the fall of 2003 when Radler and Black resigned after the board discovered they and others had received $32 million in improper payments.
Patrick J. Fitzgerald, the U.S. Attorney for the Northern District of Illinois, charged in the indictment that the defendants “engaged in a series of secret transactions, in connection with selling various newspaper publishing groups in the United States, that were designed to enrich certain corporate officers by funneling payments disguised as non-competition fees to a company they controlled, as well as to themselves individually, at the expense of Hollinger’s public shareholders and corporate assets.”
Black and his cohorts also face a raft of civil litigation, including a lawsuit filed by Hollinger that alleges the former execs looted the company of $500 million through self-dealing and doling out exorbitant management fees to themselves.
As part of the plea deal, Radler will also cooperate with the Securities and Exchange Commission’s investigation of Hollinger.
Raze the lord
The guilty plea by former Hollinger big David Radler, below, imperils his ex-boss, Conrad Black, inset. What may be next for Radler:
* 29-month prison term
* $250K fine
* Canadian prison jumpsuit