A probe at Hollinger International has concluded the company’s former chief executive – newspaper tycoon Lord Black – colluded with associates to systematically loot the company of nearly all of its profits over the past seven years.
And the report says the staggering figure involved is more than £222m.
It detailed how Black lavished the money on an extravagant lifestyle. It included up to £3m a year on a private jet, with £2,000 worth of silverware; £24,000 on his wife’s birthday party; £50,000 on a Rolls Royce; and over £1m on a New York apartment.
The report, which was filed with the US Securities and Exchange Commission today, was prepared by a special committee of Hollinger’s board formed to examine concerns from shareholders about payments made to Black and others.
Black has since been forced out as chief executive and chairman of Hollinger – former owner of the Daily and Sunday Telegraph – following initial findings from the committee he and others improperly received millions in fees and payments that should have gone to the company.
The committee’s 500-page final report makes even more sweeping allegations of wrongdoing, accusing Black and a senior associate, former chief operating officer David Radler, of milking the company to satisfy their “ravenous appetite for cash”.
In an introduction to their report, the three-member committee wrote: “Hollinger was systematically manipulated and used by its controlling shareholders for their sole benefit, and in a manner that violated every concept of fiduciary duty.”
Lord Black released a statement today, saying the report was “recycling the same exaggerated claims laced with outright lies that have been peddled in leaks to the media and over-reaching lawsuits”.
The report concluded that the amount of money looted from Hollinger by Black and others between 1997-2003 represented just over 95 per cent of the company’s entire earnings in that period