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Gary Younge
US press hit by new scandal

American newspapers were embroiled in another scandal yesterday following the resignation of two publishers prompted by an investigation into fraudulent circulation figures intended to increase advertising revenues.

The publishers of New York Newsday and its Hispanic sister paper, Hoy, stepped down when an investigation exposed deceit stretching back several years.

"There was a rogue operation - a violation of trust," said Raymond Jansen, Newsday's former publisher, who resigned on Monday along with Louis Sito, the publisher of Hoy.

On Monday, Newsday published a 4,000-word two-page mea culpa with a headline stating: "Pressure fed the problems," and a subhead saying: "A relentless drive to hit circulation goals and a sell-at-any-cost attitude has led to a crisis at Newsday and calls for industrywide reforms."

Yesterday, Newsday's own report described how Mr Jansen was stepping down "amid a spreading circulation scandal that some have called the worst to hit the newspaper industry in decades".

Newsday has now reduced its circulation figures by 7%, from 580,000, to 540,000, for papers sold during the week, while the Tribune group, which owns it, has set aside $35m (about £18.8m) to repay advertisers.

Federal and local authorities have begun investigations and several months ago advertisers filed suit claiming the paper's circulation was fraudulent.

"What I saw at Newsday in the late 1990s was pressure for [circulation] numbers that were impossible to hit and having to do all kinds of cheating to hit the numbers," Doug Wesley, a consultant hired to revitalise the paper's customer service operation, told a team of Newsday reporters who were told to investigate the scandal.

According to the inquiry, efforts to inflate the figures ranged from the crude practice of sending people the paper who had never asked for it, to manipulating industry rules, and fabrication.

In the six months to March 2004, 15.5 % of the paper's circulation was due to deeply discounted sales - the highest proportion of the country's top 20 circulation papers.

Newsstand vendors were also strong-armed into taking papers they did not want.

"If a dealer didn't want Hoy ... he's more or less threatened: then you aren't getting the paper [Newsday]," said one employee of Newsday's transport department.

A former employee in the circulation department said: "There were times when they would start home delivery for a thousand people or more for customers who never requested it."

Newsday's fall from grace is the latest in a long list of scandals to have blighted US journalism over the past year.

The New York Times recently published an extended correction over its coverage of the run-up to the Iraq war and last year lost its two most senior editors in a scandal over deceit by a reporter, Jayson Blair.

USA Today's editor also resigned after its star foreign reporter, Jack Kelley, was found to have fabricated and plagiarised his reports.

Newsday's problems do not suggest a fall in editorial standards but an institutional dependence on sharp business practices that could be even more damaging financially.

As one distributor told the Newsday reporters: "We were told not to take any names off the computer even if they were dead. We could not get customers off the records. We even delivered to addresses where the house had been burned down."

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