UPDATE 5-Conrad Black gets 6-1/2 years in jail

Mon Dec 10, 2007 8:59pm EST

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(Inserts other co-defendants sentence new paragraphs 4-5)

By Andrew Stern

CHICAGO Dec 10 (Reuters) - A U.S. judge sentenced former media mogul Conrad Black on Monday to 6-1/2 years in prison for obstructing justice and defrauding shareholders in one-time newspaper publishing empire Hollinger International Inc., and ordered him to report to prison in 12 weeks.

"You've committed a very serious offense, Mr. Black," Judge Amy St. Eve of the U.S. District Court told the 63-year-old Black as he stood before her, but her sentence was at the low end of federal guidelines.

"Frankly I cannot understand how someone of your stature, on top of a media empire, could commit such acts," she added before imposing the sentence, which also carried a fine of $125,000 and an order that he forfeit $6.1 million.

Later she sentenced Black's co-defendants who were convicted of fraud. Jack Boultbee, 64, former Hollinger chief financial officer, got 27 months and former vice president and general counsel Peter Atkinson, 60, got 2 years.

But Mark Kipnis, 60, a former U.S. Hollinger lawyer who played a relatively minor role in the fraud, was given 5 years probation and ordered to spend six months at home on electronic monitoring, though he can go to work and to church during that time.

Black, one hand resting on a table in front of the judge, told St. Eve in a clear voice before she passed sentence that he wanted to "express very profound regret and sadness" to Hollinger shareholders for "the evaporation of $1.85 billion" in value.

The 6-1/2-year sentence was near the bottom of what the judge said was a possible range of 78 to 97 months, but a far cry from the 20-plus years prosecutors had requested.

The judge allowed Black to retain ownership of his Palm Beach, Florida, mansion, and said he could keep the multimillion-dollar payoff he got for the sale of his New York apartment.

She said she would ask the government to let him serve his sentence in Florida. But Black's lawyers said they would seek a court order allowing him to remain free on bond indefinitely pending the appeal of his conviction to a higher court.

DODGING A BULLET?

Andrew Frey, the lawyer handling the appeal, said Black was in "reasonably good" spirits and believes his conviction will ultimately be overturned."

Orin Snyder, a former federal prosecutor and partner in the New York office of Gibson, Dunn & Crutcher, called the sentence "fair and very reasonable ... Conrad Black dodged a bullet today."

Patrick Fitzgerald, the U.S. attorney in Chicago, said "A lot of people lost a lot of money" and "the bottom line is he serves 6-1/2 years in jail. That's a lot of time."

The $6.1 million the judge ordered Black to forfeit was the same amount a pre-sentence report had estimated as being the size of the fraud. Prosecutors had contended Black and his three co-defendants actually stole about $31 million.

The judge also told Black he had not "accepted" his guilt, had abused the trust of shareholders and engaged in sophisticated schemes requiring more than minimal planning.

Black had maintained he was innocent throughout the trial, claiming he was the victim of "corporate governance zealots."

The Canadian-born member of Britain's House of Lords was found guilty in July of one count of obstructing justice and three counts of fraud.

Before the sentence was imposed, Black's lawyer, Jeffrey Steinbach, said Black would not "knowingly harm the company" as it would cost him as its principal shareholder. "Those are not the actions of a robber," he said. (Reporting by Andrew Stern, Editing by Carol Bishopric)

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