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Judge wants to see former news mogul's secret agreement

Judge wants to see former news mogul's secret agreement

A federal judge told attorneys for former newspaper baron Conrad M. Black on Thursday to try to get her a copy of a secret financial agreement he made with the Canadian holding company he once ran.
U.S. District Judge Amy J. St. Eve said she wants to review the agreement worked out between Black's attorneys and those of Toronto-based Hollinger Inc. that limits his access to millions of dollars in assets.
The secret agreement has become a battleground in skirmishing between the beleaguered former press lord and prosecutors who say he is trying to maneuver his way out of a promise to secure his $20 million (euro15.72 million) bond.
The bond is secured partly with a $35 million (euro27.51 million) Palm Beach, Florida, house that has a $10 million (euro7.86 million) mortgage. Black initially had said he would secure the bond by paying off the mortgage but has not and is in default.
If the mortgage company were to foreclose and take possession of the house, the value of the assets securing the bond would be sharply reduced.
Black is charged with plundering millions of dollars belonging to shareholders of Hollinger International Inc., which he controlled through the Hollinger Inc. holding company. He also is charged with misusing company money to bankroll his lavish lifestyle and cheating on his taxes.
Prosecutors told St. Eve on Thursday that Black appears to be claiming he cannot pay the mortgage because the secret agreement has frozen the funds.
While terms of the secret agreement are not known, attorneys said in court Thursday that it would keep the money in Canada and not allow it to be moved south of the border where it could be used to pay the mortgage.
Black attorney Edward M. Genson said the mortgage company has said it would not foreclose if the mortgage interest alone is paid every month.
Genson said that on Thursday a payment of $1,285,961 (euro1,010,896) representing the back interest on the mortgage, had been paid. He said the interest would be paid every month from now on, meaning the bond was effectively secured.
That irked lead prosecutor Eric H. Sussman who said Black had "rewritten at his discretion the mortgage agreement."
"He has contracted his way around having to meet is obligations to the government in court," Sussman told St. Eve.
Genson said he didn't know if he could obtain a copy of the secret agreement but would ask Black's Canadian lawyers if it would be possible.
St. Eve said if she could obtain a copy of the agreement she would not show it to the prosecution.
As for the contents of the agreement, Genson said: "I don't know what it says _ and I don't want to know what it says."


Updated : 2021-07-24 17:08 GMT+08:00