Conrad Black's hubris
Conrad Black was brought down because he behaved like the sole proprietor of his main business, the US company Holllinger, even though it was a listed company with lots of other shareholders.
One of these shareholders, an investment firm called Tweedy Browne, became increasingly concerned at what it perceived as the profligacy of Lord Black.
Lady Black gave Tweedy Browne a bit of a clue in 2002 when she told Vogue that her "extragavance knew no bounds" and that it was "always better to have two planes, because however well one plans ahead one always finds one is on the wrong continent."
Tweedy Browne feared that Lord Black was lining his own pocket with money that more properly belonged to all shareholders.
The US authorities concurred - and so too, today, has a Chicago jury.
Lord Black is famous for having the hide of an armadillo. But even he must be mortified. This friend of world leaders, a Bilderberg man, may be heading for jail.
Still, perhaps he can take a crumb of comfort from the symbolism of his conviction.
His trial is the last of a spate against company bosses who let their greed get the better of their sense of probity during the last great stock-market boom.
As financial markets soar once again, one big question is whether the current batch of corporate titans are less corruptible than their immediate predecessors.
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Robert asks whether the current batch of corporate titans are less corruptible than their immediate predecessors.
The cynic would reply "No, but they'll take greater care not to get caught".
Nevertheless, the US authorities have raised the stakes considerably, recognising that the 'little guy' has been well and truly stiffed in recent times, and in that sense, the authorities are trying to demonstrate that capitalism can have some integrity.
What is it with newspaper proprietors - elements of this case bear a similarity to Maxwell and his inability to realise that once you go public it is NOT your company.
They are happy to take the profits from the flotation but not prepared to accept their responsibility to their shareholders, continuing to run their companies like their own private fiefdoms.
The chances of Conrad Black doing 35 years are less than the shareholders seeeing any of the money again.
I wonder if Paris Hilton's doctors are available for 'expert' witness testimony regarding the state of his health.......
But John...... Can you seriously imagine the FSA doing something similar here?
It couldn't happen to a nicer fellow.
Why should there have been a shift in motivation and aspiration of 'corporate titans'? Perhaps a bit more circumspection since the post-Enron legislation, but I'm not convinced.
I've been as keen as any gossip columnist to record the rise and fall of our business leaders, so I just wanted to note that there are examples of those who remain untouched by scandal. Indeed, it used to be fashionable to portray all our business heroes in this light in the more sycophantic eighties.
It might be better to say that Conrad Black has been found guilty on specific charges of a criminal nature that would have still have been criminal even by a sole proprietor.
The story might also indicate the additional temptations facing (some) business chiefs freed from the scrutiny which occurs within public companies, like, say like those caught up in the flourishing world of Private Equity deals.
Caught at last,some of the truth comes out.He renounced his Canadian citizenship and now wants to return to his "castle" in Toronto.Can Canada say no?Let"s hope so.
Corruption of newspaper owners is the most insidious, not only losing money, but also damaging the public's faith in politics and democracy. Not many realise but headlines are for sale in many newspapers to interested parties. I am sure Black has been correctly found guilty, and that what they know is only the tip of the iceberg.
SIt will be interesting to see if and when he is allowed to return to his "castle" in Toronto.
Am I right to assume he is allowed an appeal? If so anyone care too bet the result? As to the question is this the last you are joking.
Clearly, Lord Black has been the clever architect of his own spectacular downfall.
What a shame. At least he was flagrant... a colorful character.... something so many of today's scoundrels seem to lack.
Who needs corruption? Surely the remuneration packages obtained by the tycoons of today (salary;pension schemes;share options; severance pay) make lining ones own pockets by nefarious means quite unnecessary? The firm does the job so well.
I have not followed this trial in detail, but it seems to me that the US sentences in such cases (Ebbers, Kozlowski, Lay, etc) are ridiculously heavy.
The facts that it often takes a long time and sometimes more than one jury to establish that a crime has actually occurred, and that the victims are mostly barely aware of it, suggest to me that these offences are not on a par with armed robbery, grievous bodily harm and rape which get similar sentences. Morally, there does not seem much difference to me between abuse of expenses and executive privilege, and the cynicism of investment managers taking opaque tail risks when they share in gains but not losses, or investment analysts who pump the stock of firms with which their employer has other business.
It seems to me that heavy sentences for these men represent inverse egalitarianism in response to their (or their wives’) opulent lifestyles and the large monetary value of their offence. Better to let the punishment fit such corporate crime. Fine the criminals enough to take away their gains, and give them sufficient time in jail to humble them and to make it clear that society regards their behaviour as criminal and unacceptable. Priority for long, expensive time in prison should be given to dangerous criminals, and those whose crimes have done traumatic and irreparable damage to their victims.
So what happens to Lady Black, who avidly lapped up the stolen cream along with him? As usual, the wife of the criminal goes free. Her lifestyle may be a bit constrained, but no doubt a large tranche of the booty has been squirreled away for her, well out of reach of Hollinger shareholders.
I'm employed by a large public US corporation, and I know that the leaders are seriously concerned to behave ethically and be seen to behave ethically.
Being led off in black sedans for a few years in prison is not their idea of how they want to spend their time.
So, we stick to the rules. Very carefully.
Lord Black has literally and arrogantly in his life, kicked a lot of asses. Now this is called the return of the pendulum, let's see how many friends he's got left.
Split him in two.
As a Canadian I (ashamedly) must say that I take a certain delight in watching the fall of a man who rejected the land of his birth in order, with very un-Canadian hubris, to take what he saw as his rightful place among his British peers. And now, a convicted felon, he wants his Canadian citizenship back? Well sorry, Connie - draft dodgers, yes, refugees from George Bush's America, yes, but petty crooks? No thanks.
As one of the other contributors said,couldn't have happened to a nicer man.Just as well Black was found guilty in the US-here in Blighty,he would probably have followed the example of Ernest Saunders,the only case in medical history of a man who has recovered from Altzheimer's disease,after conning his way out of fraud charges in the British courts.Hopefully US appeals courts are a bit more cynical than their UK counterparts.
As Conrad Black was so inspired by Napoleon Bonaparte perhaps he should be incarcerated in like manner. Is Bonaparte’s one time penthouse quarters on St Helena still available? As for Barbara, her columns in leading UK Sunday papers indicated that she was somewhat divorced from the real world that others have to cope with so perhaps she is well adjusted mentally to join Conrad on that blessed island.
He should be made to contemplate his actions for a while. The poor man who is caught robbing will however serve more time.
US sentences of convicted fat cats tend to be severe because severe sentences are merited for fraud etc. Since Lord Black's sentence hasn't been set you can't be sure if Judge St Eve will throw the law book at him & it will seem that he has been put under the jail, not simply in jail, by a particularly severe, but just, sentence.
Mr Fitzgerald has made his reputation as a zealous, successful prosecutor & will zealously work to have Lord Black given a most severe sentence. Lord Black isn't a lovable man. A severe sentence would be popular with the public in addition to being just & fair.
These stories about how numerous media barrons are in reality nothing but criminals is very disturbing. We talk all the time about media freedom and the independence of the media. What does this really mean? It means that the media is independent of ordinary people, and that the media is free to be manipulated (only) by the wealthy! This is the reason I have never trusted the media. But I know many do. And that is scary!
Remember the Bre-X Gold Fiasco where
no Canadian was ever convicted of a Canadian federal criminal or provincial securities offence?
In 2004-OCT, an "Inspector" was appointed for Hollinplunder Inc. by the Superior Court of Justice in Ontario, Canada. Soon after that Inspector ordered that no documents could be removed from its Toronto HQ without the Inspector’s consent or further court order.
While governed and constrained by that [Canadian] order, and other events that put Black et al on notice of various proceedings in the United States, the U.S. Securities and Exchange Commission (SEC) 2005-MAY-19 advised Black’s attorney that a written request for documents would be served shortly and the Discovery was Served the very next day.
On 2005-MAY-20 at 1400 and again after 1700 Black attempted and finally succeeded in removing 13 Bankers boxes, contrary to the American federal criminal code, 18 U.S.C. §1512(c)(1) and 2. This offence has extra-territorial (outside USA) scope.
It is outrageous that there have been no large "white collar" convictions in Canada due to Canada's infamously lax and lethargic criminal and securities fraud suppression efforts.
It is indeed ironic that Black was convicted by a US court, and faces
up to 20 years imprisonment, for defying a Canadian Superior court with its [perceived by Black] flaccid enforcement effort and
mild penalties.
I hope that the sentence Conrad Black receives fits the crime.
2to3 years would be fitting and enough time to write another political biography.A pastime Mr Black should have stuck to thus avoiding his present predicament.
I would bet he is still unaware of any wrongdoing.
It would be appropriate to just change the name in this article from Lord Black to George Bush
"George Bush behaved like the sole proprietor of the Presidency, even though it is a public office accountable to the American Public.
George Bush is famous for having the hide of an armadillo."
GWB's latest contemptuous reaction to questions from the press regarding his commuting the sentence of Libby is revolting!
Furthermore He claims that Congress should not micromanage the war. Hence Congress should use a macro-management tool - Impeachment!
Black has received his come-upance. What about Bush?
What are they waiting for?
The English disease of envy has well truly dug in now in the States. Some people can't stand the success of others and will do anything to bring them down.
Left-ism in all its forms is based around this. Their atitude is "If I can't achieve then others mustn't be allowed to".
"Not many realise but headlines are for sale in many newspapers to interested parties."
Not many... toddlers? Probably not many americans, but their stupidity is hardly news. You'd have to ignore the advertisements, articles, editorials, and op-eds.
Fry em.........all
he had the chance 7 years ago to pay 7 million dollars to avoid fraud charges. being rich and famous is no passort to wisdom.he will be facing lawsuits for a very long time. what a waste for an intellectual who could have really made a difference.
as someone has already said it couldn't happen to a nicer guy. It would be nice though if Babs (Marie Antoinette)Amiel could get a piece of the sentence too but it is most unlikely.
As to jail time I believe Canada and USA have a deal where citizens of either country can do their time in the home country. It will be interesting to see if Canada relents and takes him back for his time. We do have a few lockups with access to golf courses etc so he would have something to occupy his time. I don't knows if the UK has a similar arrangement but I assume it does. Too bad, a couple of years in Angola in Louisiana would fit him to a tee, get rid of the suet around his waste and perhaps even the stuff in his head.
The answer to Lady Black's question is that now he is on the right continent, the one where property rights and human rights are considered one and the same. As CEOs of major corporations which defrauded their shareholders or the government have learned to their chagrin, the importance of convincing the world of the fairness and openness of America's financial markets trumps the power that fame, money, and position can confer. This is not about left/right politics, this was the decision of a jury of ordinary Americans who made a judgement on the facts of evidence in the case and the law. It is very rare that a court of appeals will overturn a jury's verdict. The queston isn't whether the current batch of corporate titans are less corruptable, it's whether or not they are convinced that if they are corrupt they will get caught and pay a very heavy penalty including significant prison time.
Like a character out out of a Greek tragedy Conrad Black now faces the prospect of having the rest of his life to reflect upon behaviour which often brought a new meaning to the word hubris. The dustbin of history is littered with the stories of individuals who felt that their modus operendi was justified due to a false sense of entitlement.
Fantastic. Couldn't have happened to a nicer or friendlier fellow. Mr. Black's arrogance and "looking down his nose" at the "less priviledged" of us has finally cought up with him. Who did he think he was that he could pocket millions at the expense of the real owners of Hollinger?
I suppose the only shame is that Mrs. Black probably won't see any prison time. After all, she pocketed the riches of this grand theft as well as Mr Black.
To quote Roger Waters of Pink Flloyd fame: "There's on one more deserving of the full penalty of law".
Let us hope this 9000 pound gorilla will see daylight again from behind bars, just like his right wing wacko papers promoted for criminals. looking forward to read the editorials of his former papers smurk,;P
Tim Young and Stu Gill (comments 14 and 28 respectively) should be reminded that financial crimes perpetrated by the likes of Conrad Black ARE every bit as bad as rape, murder, drug-dealing and terrorism in that they have an equally devastating effect on the lives of thousands of people.
One only has to consider the plight of the Enron shareholders and pensioners who've lost everything, for example.
The only difference is that Black, Saunders, Lay and their ilk are white, middle-class criminals who, along with their supporters, consider themselves above the law. No doubt the same apologists for middle-class criminals will be making similar protest if the Enron/Natwest Three are convicted in the US.
Let's not forget also that Black had a fair trial before a judge and jury, with the best legal representation money can buy.
What would you have written if he had been found not guilty?
One assumes that he was trying to take money from his company in the most efficient way and it didn't work.
Interesting to see what happens on appeal.
Why waste the time and expense of a jail cell on this man, why not just fine him where it hurts [Big time]and save the cells for the violent types
Most jurisdictions have a prohibition on "receiving stolen goods" with legal penalty, of course Barbara Amiel could claim she knew nothing about her husband's crimes or the provenance of the money and assets she received or benefited from, but if she was in any way conscious of it, and ever expressed this to anyone, she'd better find herself a lawyer.
Those who move to the top in most organizations are adept in devious and illegal activities. It is what it takes for them to rise. So why be surprised that they take advantage of the power they have gained by their improper actions? It is the rare CEO, cardinal, president or executive director who rises purely on productive action.
Having worked closely with a few CEOs over the years it comes as no surprise about Black's behaviour. Without fail power makes them lose touch with reality - particularly if they come from a modest background. It seems that those who rise to top positions are born with a nasty gene.
> It seems that those who rise to top
> positions are born with a nasty
> gene.
You are right. I always treat big business as roughly as I can get away with, and I try to cost them as much as possible, because I suspect they promote the "nasty gene". It's a complete turn-off.
Until they can show that they are behaving in a socially responsible manner at all times, it's best to rip them off and do them down at every turn – we owe that much at least to our fellow citizens.
what shareholders should remember is just how much value this fantastic man made for them all over the years. kick a man when he is down but knowing this guy just wait for his return. good luck to him and his wife who has stuck with him-in good times and in these bad times-that is loyalty.
Ian #37,
You beat me to it! Thanks goodness there are people who aren't so naive as to think these white collar crimes are victimless or somehow benign. Agreed that in some ways they can be even more devastating than say a bank robbery or burglary because the ripple effect is widespread... ripped off shareholders and laid-off employees, whistleblowers intimidated and ruined, vendors who go unpaid if the company becomes insolvent, huge litigation costs, damage to the public trust etc.
Dudley D. Wright #25
Canada's so-called enforcement system is a joke. Bre-X is just one example, there are many more...Livent, Cinar, Nortel being investigated, Atlas Cold Storage. If the perps were black, people would be baying for their hides but since they're part of the
"establishment" (aka ol' boys club), it's almost as if they are considered entitled. Shame.
Conrad Black will be successful in his appeal. The U.S. judicial system that has wielded a sledge hammer to slay a knat will be it self brought to justice. The millions upon millions wasted by the prosecution should have been spent more wisely, perhaps by going after a real criminal, guilty of real crimes.
Referring to comment 9 of 14 July by B. Schell:
I hope that by the time the courts get through fining Conrad Black, he won't have a "castle" in Toronto - or anywhere else for that matter - to return to.