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Black is already being investigated by the SEC and by authorities in Chicago, the city Hollinger lists as its headquarters. The two will work in tandem and the SEC is “almost bound” to bring legal action against Black, said Coffee.

The Hollinger Chronicles, as the report is known, was compiled by Richard Breeden, a former chairman of the SEC, and contains such damning accusations that “the SEC, I am sure, will proceed against him”, said Coffee.

Should Black be found guilty, the SEC can fine him, demand he repay money and ban him for life from holding office in an American company. But the watchdog’s powers are civil, not criminal.

It will ultimately be up to Illinois’s attorney-general, Lisa Madigan, to decide whether criminal charges will be brought against the peer. Kozlowski’s trial will weigh heavily on the mind of any prosecutor. “In almost all respects this is a case that is similar to Tyco,” said Coffee. “And that one started unravelling all over the place the minute it got to court.”

Kozlowski’s trial was heralded by headline-grabbing examples of his excess and gross spending sprees. The trial proved far less spectacular, with the jury worn down by mindnumbing and complex arguments.

“I think this report could well result in indictments, but it’s not a slam dunk,” said Coffee. He expects prosecutors to begin working on former Hollinger directors to turn against Black and act as witnesses for the prosecution. “Flipping” witnesses, as its known, has been particularly successful in securing convictions against executives of Enron, the energy firm that imploded in one of America’s biggest scandals.

James Cox, law professor at Duke University, said Breeden’s report looks too damning for Black to escape criminal prosecution. “If Breeden is right, then it seems that this was not a question of poor judgment, but of scheming and design,” he said. He reckoned that prosecutors would identify one or two areas where they believe the evidence is strongest and attack Black on those charges rather than going to trial with a long list of accusations, as happened in the first Tyco case.

Last April, that case ended in mistrial after six months in court and two weeks of jury deliberation. Prosecutors are to bring the case back to court and are expected to trim down their charges after the successful prosecution of two other fallen business stars.

Complexity was a potential problem in the trial of Frank Quattrone, a former star banker at Credit Suisse First Boston. Quattrone was the biggest banker of the dotcom era and made millions for his clients from share sales in companies that subsequently collapsed, costing the investing public and pensioners billions in lost savings. Prosecutors side-stepped getting involved in a complex securities case and instead pursued Quattrone, successfully, for obstruction of justice. Martha Stewart, the media queen, was also convicted on obstruction charges after an investigation of insider-dealing charges — something that is very hard to prove.

Hollinger and Black’s affairs are about as tangled as they come. The peer controlled the Telegraph empire through a network of holding companies, had significant operations in Britain and Canada as well as the United States, and banked many of his most controversial payments in Bermuda.

With the successful prosecution of Stewart and Quattrone on simpler charges, Chicago’s prosecutors may be tempted to follow a similar solution, say legal experts. They say Black’s past behaviour has left him vulnerable to such an attack — one that could avoid the complexities involved in Breeden’s report, but could still land the peer in jail.

IN the early 1980s, Black was feeling socially and politically stifled in his native Canada. A lifelong Amerophile, he set his sights on making his debut in business across the border. An ideal candidate was found in Hanna Mining, a company whose largest shareholders were some of America’s most well-connected families, including the Humphrey family — George Humphrey was President Eisenhower’s secretary of the Treasury.