David Radler, the prosecution's star witness and once one of Conrad Black's closest associates, linked the former media magnate to the alleged fraudulent skimming of money away from Hollinger International Inc.

Prosecutors asked Radler, Black's long-time partner and second-in-command, if Black had instructed him that 25 per cent of all "non-compete" fees from the sale of the Chicago-based company's assets would be paid to Hollinger Inc., a Toronto-based firm.

"He confirmed that was the plan," Radler testified Tuesday, his second day on the witness stand at Black's trial in Chicago. "He said yes, and that was it."

Things weren't going so well for their publishing empire in the late 1990s, and so Hollinger International began selling off some of its U.S. community newspapers to pay off debt, he said.

"Conrad suggested (in a phone call) we insert ourselves in the non-compete process and I agreed," he said.

Non-compete agreements are monies paid by a purchaser to the seller, to ensure the seller doesn't open a competing publication in the same market.

Radler -- who has already pleaded guilty to one count of fraud and is testifying as part of a plea bargain deal -- said Black and the other three co-defendants used part of the tax-free non-compete payments as bonuses to themselves.

Prosecutors say by doing so and not telling the Hollinger International Inc. board, the defendants cheated shareholders of US$60 million.

Black, 62, and co-accused John Boultbee, Peter Atkinson and Mark Kipnis maintain they didn't break the law and disclosed the payments.

Radler had assumed the money would stay with Hollinger International. He admitted that he and Black  had very few conversations about the impact on company shareholders, but testified they were allowed to do so provided they got approvals from the audit committee.

"I didn't know if it was legal or not legal. I didn't like the transaction. I should have said something. But I didn't. I regret that I didn't say anything," Radler said.

Lead prosecutor Eric Sussman had been expected to wrap up questioning Radler on Tuesday. But CTV's David Akin told Newsnet that prosecutors introduced numerous boxes of documents that they say include important evidence to the case.

These are the boxes that Conrad Black once tried to remove from his Toronto headquarters, an act caught on security video. "The prosecution says they contain cancelled cheques, emails," Akin reported. "All stuff that's important to the prosecution's case."

Black's defence lawyers convinced the judge they needed time to go over the documents. The trial adjourned at 1 p.m. EDT.

The defence might not start its cross-examination until late Wednesday or Thursday, which means Radler might not be done until early next week, he said.

Defence plans

Attorney Robert Kent wrote the initial indictment against Black. He said Radler is the whistleblower who can prove the prosecution's case against Black and the others.

"He's the only person from the inside, who, from the government perspective, can explain to the jury what the plan was and how the defendants went about implementing it," he said.

After court ended, Canadian defence lawyer Eddie Greenspan remarked to reporters, "I didn't come to Chicago to just sit there."

Black, when asked about Radler's testimony, said: "You gotta wait for the cross-examination. I won't comment until the defence has finished." He then added, "You may not recognize him."

Greenspan has said he looks forward to cross-examining Radler. He wants to paint him as a liar who agreed to testify against Black to save his own skin.

Chicago lawyer Hugh Totten, who has been following the trial, said Radler's testimony so far hasn't provided clear evidence of criminal acts.

"The jury has been waiting to hear from this guy for seven weeks (and) he's not selling it (his arguments) to the jury," he told The Canadian Press.

"What you have now is a lot of testimony out there that's really conflicted -- It's not clear that these people had criminal intent."

Totten expected an aggressive cross-examination of Radler.

Radler was calm in the witness stand on Tuesday, although he appeared rattled at times by the barrage of defence objections.

Black, who eyed Radler after he took the witness stand, spent most of Tuesday taking notes and whispering to his lawyers.

With a report from CTV's Joy Malbon and files from CTV's David Akin, The Canadian Press and The Associated Press