Conrad Black faces jail over fraud

As one time proprietor of the third biggest newspaper empire in the world, Conrad Black was feted by the rich and powerful. Today Conrad Black, the former owner of the Fairfax group in Australia, is on trial in a US court for allegedly defrauding shareholders.

Prosecutors claim Black did it to maintain his extravagant lifestyle, which includes membership of Britain's House of Lords.

Lord Black insists he's innocent and is the victim of a big smear campaign.

North America Correspondent Michael Rowland reports.

MICHAEL ROWLAND: For a man who's always had a very low opinion of journalists, he once described them as ignorant and lazy, the sight of the media scrum gathered in Chicago for today's proceedings must have been particularly galling for Conrad Black.

But then, Lord Black is galled by a lot of things at the moment, particularly the fraud charges, which he sees as nothing less than a personal affront.

CONRAD BLACK: There's no truth or substance whatsoever to these charges and are you going to fight them, what do you think?

REPORTER: Well, I'd just like you to say"¦

CONRAD BLACK: Yeah, I know you would, but we'll conduct these things in the proper place. Like I understand this is a news story but this has been one massive smear job from A to Z and it will have a surprise ending.

REPORTER: And what kind of an ending would that be?

CONRAD BLACK: A complete vindication of the defendants and an exposure of their persecutors.

MICHAEL ROWLAND: That's not the ending US prosecutors are planning. They want to put Conrad Black behind bars for a very long time, claiming he stole more than $100 million from his media empire to maintain a lavish, jet-setting lifestyle.

It's alleged Lord Black used shareholders money to refurbish a Rolls Royce, buy designer handbags for his socialite wife and take exotic holidays.

It's a stunning fall from grace for a man who was once a powerful media baron, his Hollinger Group-owned newspapers including Britain's Daily Telegraph and the Jerusalem Post.

For a brief and turbulent period in the 1990s Conrad Black was at the helm of Australia's Fairfax newspapers.

He used his papers to build his personal prestige, rubbing shoulders with movers and shakers including former British prime minister, Margaret Thatcher, and former US secretary of state, Henry Kissinger.

He even renounced his Canadian citizenship to enter Britain's House of Lords.

CONRAD BLACK: I, Conrad Lord Black of Crossharbour, do swear by almighty God"¦

MICHAEL ROWLAND: This life of wealth and privilege may work against Conrad Black as his trial plays out.

Andrew Stoltman is a Chicago lawyer who represents aggrieved shareholders.

ANDREW STOLTMAN: Realise that the average juror in Federal Court here in Chicago is a blue-collar 50 to 55 year old man or woman, relatively no education, probably making somewhere between $50,000 to $60,000 a year.

I think it's going to be extraordinarily hard for Conrad Black to relate to the average juror that we see here in Federal Court here in Chicago.

MICHAEL ROWLAND: Conrad Black's lawyer, Eddie Greenspan, has already made one key strategic decision.

EDDIE GREENSPAN: I have no intention of using the name Lord ever.

MICHAEL ROWLAND: For his part, Conrad Black is exuding his legendary confidence.

In a newspaper column on the eve of his trial he declared he wasn't afraid, believing he'd survive what he called "a shock and awe campaign of intimidation and defamation".

This is Michael Rowland reporting for AM. - SOURCE: © 2007 Australian Broadcasting Corporation