A Few Common Threads in Three Circulation Scandals

By: E&P Staff A lengthy report in the St. Petersburg (Fla.) Times on the recent circulation scandals that rocked the newspaper industry identifies what it calls "several common threads" among the scandals at the Dallas Morning News, Newsday/Hoy and the Chicago Sun-Times: "All involved public corporations, all involved large-market newspapers with a high number of single-copy sales (as compared to home subscribers), and all relied heavily on independent distributors."

And with the exception of Hoy, the papers all had reported only modest circ increases, or even slight declines.

The Times quoted a recent E&P opinion column by Jay Schiller, an ex-Audit Bureau of Circulations auditor, who said some auditors ignored red flags, such as the phenomenal growth at Hoy. "If Hoy was an Olympic or professional athlete, it would have been taking drug tests every week," Schiller wrote. "No one gets that big that fast."

The Audit Bureau, the Times noted, rejected Schiller's criticism, and pointed out that he left the company more than a decade ago.

Looking at the St. Pete Times itself, reporter Kris Hundley revealed that the paper had "equipped ad reps with talking points to reassure customers of the validity of its circulation numbers. An independent auditor verifies that papers sponsored by a third party reach their promised audience, for example. And to encourage sellers of single-copy papers to keep track of copies they don't sell, the paper gives them full credit for the unsold papers.

"Maurice Beausoleil is an independent contractor who handles Sunday Times sales in Pinellas County and west Pasco County. He buys papers from the Times at a discount, then sells them through subcontractors, 63 in Pinellas and 24 in west Pasco. These street-corner hawkers work on consignment, getting a commission for each paper sold.

"On Monday mornings, Beausoleil returns all unsold papers to the Times, receiving a credit on his account for the following week. He also provides the Times with an audit of sales by location.

"Beausoleil, who has been selling the Times for three years, said he is constantly trying to beat his previous year's sales. If he inflates figures one year, he would have to inflate them higher the next year, all at significant personal cost.

"'Why would I want to compete with myself?'" he asked. "'I have no incentive whatsoever to cause me to even think about fudging a number.'"