MAIN NEWS HEADLINES
August 1-15, 2004 Edition
New Newsday Publisher
Reassures Employees Amid
Circulation ScandalNEW YORK, NY/07/21/04Newsday’s new publisher, Timothy P.Knight, has vowed to create an atmosphere of “transparency, openness and honesty in the way we run our business.” Knight, who officially takes over August 15, spoke to employees July 20 following the resignation of former publisher Raymond Jansen. Jansen and the publisher of a sister publication, are being investigated for falsely inflating circulation figures in order to boost ad sales.
Both Jansen and Louis Sito, publisher of Newsday’s sister Hispanic publication, Hoy, recently stepped down when the investigation revealed possible fraud dating back several years.
The scandal has been called “the worst to hit the newspaper industry in decades.” Newsday has subsequently reduced its circulation figures by 7 percent from 580,000 to 540,000. The newspaper’s parent company, the Tribune Co., plans to pay advertisers up to $35 million in restitution.
The newspapers had been under Federal and local investigation for several months for possible circulation fraud, including fabrication and manipulation of industry rules. Some vendors reportedly were threatened that unless they took distribution of Hoy, they wouldn’t get Newsday’s product to distribute either. Among the misdeeds, the newspapers allegedly sent the publications to numerous people who had never requested them and delivered to homes that were nonexistent.
Knight said law enforcement investigations of Newsday and Hoy were “informal” and that investigators have requested documents.
One news source quoted John McKeon, executive vice president and general manager of Newsday, as saying there was nothing inappropriate about the goals, but the means to those goals were “inappropriate.”
Knight told his employees that “We’re going to accept responsibility for this, and we’re going to fix it.”