Washington, D.C., March 16, 2007 – LAWFUEL – The Securities and Ex…

Washington, D.C., March 16, 2007 – LAWFUEL – The Securities and Exchange Commission announced today that it has settled its enforcement action against F. David Radler, the former Deputy Chairman and COO of Hollinger International, Inc., pending in the U.S. District Court, Northern District of Illinois. Under the terms of the settlement, Radler is

ordered to pay approximately $23.7 million in disgorgement and prejudgment interest;
ordered to pay a $5 million civil penalty;
barred from serving as an officer or director of a public company; and
enjoined from violations of the antifraud, proxy, books and records, reporting, and internal control provisions of the federal securities laws.

Linda Chatman Thompson, Director of the Commission’s Division of Enforcement, said, “Radler and others misappropriated millions of dollars from Hollinger International and made numerous misstatements to shareholders as part of their scheme. The tough sanctions in this settlement, including one of the largest civil penalties in recent years against an individual wrongdoer, reflect our resolve to act forcefully against corporate officers who perpetrate fraud against those whom they were supposed to serve, the shareholders of the company.”

Merri Jo Gillette, Director of the Commission’s Midwest Regional Office, said, “Officers who steal from the company coffers have no place in the boardroom. In this case, Radler participated in a scheme to divert millions for his own benefit at the expense of public shareholders. As a result of his misconduct, Radler will be barred from ever again serving as an officer or director of a public company. ”

On Nov. 15, 2004, the Commission filed its action against Radler, Conrad M. Black, Hollinger International’s former Chairman and CEO, and Hollinger, Inc., Hollinger International’s controlling shareholder, alleging that from approximately 1999 through 2003, the defendants engaged in a fraudulent and deceptive scheme to divert cash and assets from Hollinger International, Inc., through a series of related party transactions.

The Commission’s complaint alleges, among other things, that Black and Radler diverted to themselves, other corporate insiders and Hollinger, Inc. approximately $85 million of the proceeds from Hollinger International’s sale of newspaper publications through purported “non-competition” payments. The complaint also alleges that Black and Radler orchestrated the sale of certain of Hollinger International’s newspaper publications at below-market prices to another privately-held company owned and controlled by Black and Radler, including the sale of one publication for $1.00. The complaint further alleges that in order to perpetrate their fraudulent scheme, Black and Radler misled Hollinger International’s Audit Committee and Board of Directors concerning the related party transactions and also misrepresented and omitted to state material facts regarding these transactions in Hollinger International’s filings with the Commission and during shareholder meetings.

Radler, without admitting or denying the allegations in the complaint, has consented to the entry of a final judgment which permanently enjoins him from violations of Sections 10(b), 13(b)(5) and 14(a) of the Securities Exchange Act of 1934 and Rules 10b-5, 13b2-1, 14a-3 and 14a-9 thereunder, and, as a control person, Sections 13(a) and 13(b)(2)(A) and 13(b)(2)(B) of the Exchange Act and Rules 12b-20, 13a-1, and 13a-13 thereunder. The Final Judgment also bars Radler from acting as an officer and director of a public company and orders Radler to pay a total of $23,695,227 in disgorgement and prejudgment interest and a $5,000,000 civil penalty. The $28,695,227 shall be distributed to The Sun-Times Media Group, Inc., formerly known as Hollinger International, Inc., pursuant to the Fair Funds provisions of Section 308 of the Sarbanes-Oxley Act of 2002. The settlement is subject to approval of U.S. District Judge William T. Hart.

The SEC acknowledges the assistance of the Ontario Securities Commission.

Scroll to Top