Richard Perle in Firing Line

international | anti-war / imperialism | news report Wednesday September 01, 2004 01:19 by Michael Hennigan - Finfacts

Asked to repay bonuses of $3.1m plus fees

On Tuesday, August 30th a scathing report detailing allegations of 'self-righteous, and aggressive looting' by Lord Conrad Black and his associates who controlled Hollinger International, the former owner of the UK's Daily Telegraph newspaper was presented to the US Securities and Exchange Commission.

Former board member Richard Perle, 62, gets his own chapter in the report. Perle is also a former member of the Pentagon's Defense Policy Board. The Hollinger board panel said Perle helped Black evade disclosure of his actions to the audit committee and the board. Perle should be required to disgorge all the pay he received from the company, which includes $3.1 million in bonuses from running a money-losing Internet investment arm, the report said.‘The Special Committee finds that Perle repeatedly placed his own interests ahead of those of Hollinger’s public shareholders, which violated his duty of loyalty,’ the report said.

Lord Black and his associates have been accused looting the company's money on a grand scale when Black, was chairman of Hollinger International. The company which is the former owner of the UK newspaper The Daily Telegraph, was 'victimised' by its controlling shareholders, who took millions in payments that should have gone to the company, according to a report filed with the US Securities and Exchange Commission on August 30, 2004.

The report said the company was 'systematically manipulated . . . in a manner that violated every fiduciary duty.’ A summary of the report was given the title ‘A Corporate Kleptocracy.’

‘Not once or twice, but on dozens of occasions Hollinger was victimised by its controlling shareholders as they transferred to themselves and their affiliates more than $400 million in the last seven years,’’ according to the report commissioned by a special board committee of the newspaper publisher.

‘Hollinger went from being an expanding business to becoming a company whose sole preoccupation was generating current cash for the controlling shareholders, with no concern for building future enterprise value or wealth for all shareholders,’ the committee found. ‘Behind a constant stream of bombast regarding their accomplishments as self-described proprietors, Black and Radler ( former publisher of the Chicago Sun-Times) made it their business to line their pockets at the expense of Hollinger almost every day, in almost every way they could devise.’

Black and his wife, Barbara Amiel Black, a former columnist for The Daily Telegraph, as well as the Radler family used Hollinger as a ‘piggy bank’ for personal expenses, the panel said.

The company bought a Challenger aircraft for Radler for $11.6 million and leased a Gulfstream IV jet at $3 million to $4 million a year for the Blacks. Hollinger allowed the Blacks to ‘swap’ Park Avenue apartments with the company, which ‘rigged’ the transaction so the Blacks could obtain Hollinger’s apartment for $2.5 million below its market value, the report said.

Hollinger also paid for food, cell phones, perfumes and other living expenses for Black and his wife, the report said. These included $2,463 on handbags for Amiel Black, $2,785 in opera tickets, $2,083 on exercise equipment and a $42,870 ‘Happy Birthday Barbara dinner party’ at New York’s La Grenouille restaurant attended by designer Oscar de la Renta and television broadcasters Peter Jennings, Charlie Rose and Barbara Walters.

The meal, given for 80 guests, included beluga caviar, lobster ceviche and 69 bottles of wine.