Haifa U. Returns Former JPost Chair's 'Fraud' Money

Haifa University has returned to the Jerusalem Post $75,000 donated by the newspaper's former chairman, David Radler, who pleaded guilty to playing a part in a multi-million dollar fraud scandal involving his partner in the Hollinger media empire, Conrad Black.

The university's announcement comes 10 days after Radler, the former chief operating officer of Hollinger International, agreed to pay the U.S. Securities and Exchange Commission $28.7 million in a settlement.

The university, which has been deliberating its course of action since Radler pleaded guilty to fraud and was sentenced to jail time in a Chicago courtroom 18 months ago, is returning the money "on moral grounds," according to a statement released yesterday.

The announcement did not state whether the university intends to strip the former top media executive of the honorary doctorate it bestowed on him in 2002. "The decision to return the money reflects what we think about his honorary doctorate, but we have no procedure in place to return honorary doctorates at present," said university spokesman Amir Gilat when questioned on the matter.

Radler's gift to the university has been frozen since 2003 after it was learned that some of the money was misappropriated from the Jerusalem Post's charity funds. Pressure on the university to return the tainted money was intensified in September 2005 following Radler's guilty plea to one charge that he participated in a scheme to fraudulently divert millions of dollars from Hollinger International. Queen's University in Canada immediately announced it would return Radler's donation of $915,180.

The single charge of fraud was reduced from seven in Radler's initial indictment when he agreed to cooperate with federal authorities in a deal which called for a $250,000 fine and a shortened prison term of 29 months, which Radler will likely serve in Canada.

In last week's agreement with the U.S. Securities and Exchange Commission, Radler did not admit or deny allegations, but the terms stipulate that - in addition to his fine of nearly $28 million - he is barred from acting as an officer or director of a public company. Last week, Radler also settled with Sun-Times Media, as Hollinger International is now known, and will pay $63.4 million to the company in addition to some $9 million he already paid, according to reports in the Canadian media.

Canadian-born Radler, 64, is expected to be the star witness for prosecutors in the high-profile trial of Conrad Black and three co-defendants, which began last week in Chicago.

In a 513-page report submitted to the U.S. Securities and Exchange Commission in 2004, Radler and Black were accused of running a "corporate kleptocracy," lining their pockets at the expense of the giant media corporation's stockholders.

The report outlined several cases of the misuse of charity funds belonging to the corporation's newspapers and quoted former Jerusalem Post publisher Tom Rose as saying that Radler wished to contribute money to Haifa University and receive an honorary doctorate by transferring part of the sum - $25,000 - from the newspaper's charitable fund, which was established some 70 years ago to collect money from the paper's readers for the needy.

It was also stated that Rose warned Radler against transferring monies from the fund as a personal contribution to the university, but Radler insisted.

President and CEO of the Jerusalem Post, Moshe Bar-Zvi, told Haaretz yesterday that all monies received by the university would be returned to the sources from which they were originally taken, including the newspaper's charitable funds. "We will make an announcement when we have finished doing the final calculations, probably right after Pesach," he said.