Wrapping It Up (Overture)

A report by Paul Waldie, webbed in the Globe and Mail, quotes from an E-mail written by Peter Atkinson introduced into court this morning: "Lord Black has insisted that CanWest demanded the non-competes be included as part of the deal. But in the email, dated June 2, 2003, Mr. Atkinson indicated that CanWest did not put a price on the non-competes and didn't 'stipulate that money would be paid to individuals and Ravelston.' ... The e-mail appears to back up prosecutor's allegation that most of the non-compete payment should have gone to Hollinger and not the individuals. Lawyers for Lord Black and Mr. Atkinson have argued the payments were legal." It also notes that the defense for Mr. Black will probably not take very long to present.

[A new development has been just reported by Paul Waldie: the prosecution is dropping the money-laundering charge against Conrad Black. Eric Sussman asked for it, and Judge St. Eve acceeded. Details in that same report.]

A brief AP report, webbed by WQAD.com, has a summary of the testimony of IRS agent Shari Schindler. According to it, she testified that "when Black was its chairman... Hollinger International under-reported its 1999 income by more than $$13 million and its 2000 income by more than ten million."

The Reuters report, written by Andrew Stern, spells out the above in its opening paragraph: "A U.S. government agent who analyzed the tax returns of Conrad Black's former company testified on Wednesday that the firm would have had nearly $24 million more in income over two years if money had not been diverted by the former media baron and his associates." It further discloses that it is Ms. Schindler's opinion that this is the case, subject to an assumption: "Schindler said the 'taxable income was underreported,'... assumes the money should have gone to the company and not to Black, his co-defendants and Hollinger Inc., a Canadian company he closely controlled. Under that assumption, Hollinger International would have taken in $13 million more in 1999 and $10.8 million more in 2000, she said."

A more detailed AP report, webbed by PR-inside.com, contains an excerpt from the cross-examination of Ms. Schindler: "'If the monies were not illegally diverted from Hollinger International, it shouldn't have been on the income tax return, should it?' Black defense attorney Edward M. Genson asked [her].... 'That's right,' the agent said." It also passes along an order from Judge St. Eve to the jury, to take a long lunch on the grounds of the prosecution is seemingly at its last witness.

Mark Steyn has some excerpts from the cross-examination too, in two entries for his Maclean's Conrad Black trial blog. The first one reports that "Agent Schindler does not always provide expert testimony on such a constrained basis.... [A]s Edward Genson, defence counsel asked her: 'It’s not always assumptions you’re testifying to, is it, Ms Schindler?'

"'No. Just in this case it is,' said the witness.

"Counsellor Genson then observed that, if the payments weren’t illegal, then they shouldn’t have been on Hollinger International’s tax return. 'That’s correct,' said Agent Schindler.... That’s a different assumption than I was asked to make...'" [More here.]

In a more recent entry, Mr. Steyn relays this question from Ron Safer, and Ms. Schindler's answer: "[Csr.] Safer, counsel for Mark Kipnis, elicited the admission from IRS Agent Schindler that, although she would have been willing and qualified to examine whether the disputed payments were illegal, the prosecution chose not to ask her to."

Mary Vallis' report, webbed by the National Post, begins with a report on the direct examination and Csr. Genson's cross-examination of Ms. Schindler. It also mentions that there is going to be an FBI agent up on the stand this afternoon; that Csr. Genson wants to wait for at least two defense witnesses to fly in to Chicago, so the other defendants will call witnesses until they get there; and, that the reciepts for certain purchases have not been entered into evidence as of yet because the defense has challenged the admissibility of some of them, including a receipt from Fendi.

CBC News has webbed a report by Mike Robinson (of AP) which has this excerpt from the cross-examination of Ms. Schindler by Csr. Newman at its end: "Boultbee lawyer Gus Newman stressed that big accounting firm KPMG had signed off on the company's tax returns after reading the working papers on which they were based and had certified that all of the money 'appears properly accounted for,' a phrase he had Schindler read aloud to the jury."

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Mr. Steyn pulled back somewhat from trial watching in his latest blog entry to write a polemic against the costs of Sarbanes-Oxley compliance. (In fact the costs are so high, that 'only the rich' can afford the resultant lodestone. Fans of cost-no-object commercial laws, please take note, if only to scry your political successors out in advance.)