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Former Hollinger International executive Mark Kipnis leaves the federal building in Chicago Dec. 10, 2007, after sentencing in his racketeering and fraud trial. (Jerry Lai/Jerry Lai/The Associated Press)
Former Hollinger International executive Mark Kipnis leaves the federal building in Chicago Dec. 10, 2007, after sentencing in his racketeering and fraud trial. (Jerry Lai/Jerry Lai/The Associated Press)

Life unravelling for former Hollinger exec Mark Kipnis Add to ...

When a Chicago jury convicted Conrad Black and three other former Hollinger group executives of fraud in 2007, many of those watching shed a tear for one of the co-accused - Mark Kipnis.

Mr. Kipnis, Hollinger's former corporate counsel and the only American on trial, did not pocket any money from the fraud and his homespun appearance and slight stutter looked out of the place next to Lord Black and the others. Even Judge Amy St. Eve, who presided over the trial, expressed sympathy, telling Mr. Kipnis during a sentencing hearing that he was "clearly the least culpable person in this scheme." The judge felt so strongly, she dropped one fraud charge against Mr. Kipnis and sentenced him to five years probation, making him the only defendant not to serve jail time.

But since then Mr. Kipnis's life has unravelled. While most of the others are out of jail (Lord Black is the only one still behind bars) and are either back in business or enjoying the support of powerful friends, Mr. Kipnis has been struggling to make ends meet.

Documents filed in a Chicago court this week show he has fallen behind on mortgage payments and is in danger of losing "the family's sole remaining asset: their home." He lost his law licence because of the criminal conviction and tried to run a Sign-A-Rama franchise with his wife and son. But the business has been hit hard by the recession, making "it impossible for him to support his family through this pursuit," the filings said.

Mr. Kipnis, 63, is trying to land a job with a real estate company and he recently passed the licensing test to become a real estate agent. But he can't get the licence because he's still on probation, according to the filings. And he can't land the job without the licence. To make things worse, Mr. Kipnis's wife, Kay, recently had surgery to remove a kidney.

"It's a difficult process," he said Wednesday from his home in Chicago, referring to his financial difficulties. "Yes, it's a problem."

His lawyer, Ron Safer, is asking Judge St. Eve to drop Mr. Kipnis's probation so he can get the realtor licence and take the job. "In light of all of the circumstances surrounding Kipnis's case, the interests of justice would be served by terminating Kipnis's supervised release at this time," he argued. Mr. Safer added that Mr. Kipnis's probation officer supports the request and prosecutors have not taken a position.

While Mr. Kipnis struggles to hang on to his house and get a job, some of his former colleagues have fared better.

David Radler, who pleaded guilty to one charge of fraud before the trial, got out of jail in 2008 after serving 10 months of a 29-month sentence. He's now running Vancouver-based Alberta Newspaper Group, which owns dozens of papers across North America.

Peter Atkinson, who received a 24-month sentence, spent about a year in jail before winning parole and returning to Toronto. He has travelled widely with his wife, a nutritional scientist at McMaster University in Hamilton.

John Boultbee was released on bail in 2009 pending an appeal of the Hollinger case to the United States Supreme Court. He returned to his home in Victoria, where he once belonged to the Victoria Golf Club, and counts among his friends William Pugliese, the founder of Iamgold Corp., who put up $1.5-million (U.S.) in cash for Mr. Boultbee's bail when he was indicted in 2005.

Mr. Kipnis still has one legal option. He joined the appeal to the U.S. Supreme Court along with Lord Black and Mr. Boultbee, and the top court is expected to release its ruling soon. Several legal experts expect the judges to strike down a key legal theory that prosecutors used to win the fraud convictions. Prosecutors would then have to decide whether to re-try Mr. Kipnis and the others, or drop the case.

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