Audit Bureau of Circulations Hit With Fraud Lawsuit

Software Developer Alleges ABC Was Part of Circulation-Inflation Scheme

By Published on .

NEW YORK (AdAge.com) -- When advertisers cry circulation fraud, they typically target the magazines or newspapers in which they bought ads. But now an unhappy advertiser has filed a lawsuit alleging that the Audit Bureau of Circulations was itself part of a circulation-inflation scheme.
A lawsuit alleges that ABC helped publishers cover their tracks as they inflated paid circulation figures at 'Laptop' magazine.
A lawsuit alleges that ABC helped publishers cover their tracks as they inflated paid circulation figures at 'Laptop' magazine.
Teletype Co. points finger
The advertiser, a software developer called Teletype Co., alleges in the suit that ABC helped publishers cover their tracks as they inflated paid circulation figures at Laptop magazine. Mark Gardy, an attorney for the plaintiff, told Advertising Age that an investigation by the plaintiff's team supported that allegation, but he declined to elaborate.

In addition to the bureau, the suit seeks damages from Bedford Communications, which publishes Laptop, two Bedford executives and the now-defunct circulation sponsor InFlight Newspapers and Magazines. Newsday reported the suit in its April 18 issue.

In a statement released today, ABC President Michael J. Lavery said his group's inclusion as a defendant had no merit. "ABC concluded its last audit of Laptop magazine in 2002 and has since terminated the publication's membership in ABC," he said. "Moreover, ABC has no relationship with InFlight Newspapers and Magazines, Bedford Communications, or any of their principals."

No comment from execs
Edward D. Brown, the Bedford president and publisher who is named in the suit, did not respond to a message left seeking comment. An attorney for John Jay Annis, Bedford's former director of circulation and the other Bedford executive named in the suit, declined to comment.

In a separate case last October, federal prosecutors charged Mr. Brown and Mr. Annis with scheming to overstate circulation at Laptop; that case is in plea negotiations, according to court filings. The audit bureau said last July that it would no longer count as "paid" any circulation derived from InFlight -- because InFlight had stopped paying for the magazines and newspapers it accepted from publishers. InFlight executives could not be reached.
In this article:
Most Popular