Black admits false pay statements

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The Independent Online

Hollinger International, the group headed by Lord Black of Crossharbour, is to face an investigation by US regulators after it admitted filing false statements on executive pay.

A committee set up by the company, which owns the Daily and Sunday Telegraph, to investigate allegations of corporate excess, has found that Hollinger mis-stated how much it paid directors in the past.

The New York-based group has been under pressure from shareholders angry at payments to directors and companies controlled by directors. These include $73.7m (£43.7m) given to Lord Black, three other directors and a company they control for a non-compete clause.

In response, Lord Black set up a special committee, advised by the former head of the Securities and Exchange Commission, Richard Breeden.

This committee reported on Friday, saying: "There are inaccuracies in prior public filings of the company involving the amount, authorisation and purpose of [payments to directors] among other things."

The report, released after the New York market closed, did not detail where the misstatements had occurred. No one at Hollinger was available for comment.

Hollinger has had to delay releasing its third quarter results and the news will make it more difficult to agree a financial restructuring. Investors as diverse as property tycoon Nelson Peltz and Bain Capital have been named as possible investors.