By WILLIAM DOTINGA
LOS ANGELES (CN) - Los Angeles Times fired an auditor for blowing the whistle on a scheme to pad circulation numbers, the man and his company claim in court. The higher a newspaper's circulation, the more it can charge advertisers.
At some point, Daley says he became aware of "past fraudulent behavior at the Times, whereby the Times entered into agreements to 'buy its own newspapers' and count the purchases as part of its circulation," the complaint states.
"This fraud was designed to deceive the Times' advertisers and was very similar to a situation involving newspapers Newsday and Hoy, which led to federal arrests and convictions of Tribune employees. In fact, while the U.S. Attorney in New York was prosecuting employees of Tribune regarding Newsday and Hoy, the Times was engaging in essentially the same illegal activities in Los Angeles. As with the Newsday and Hoy case, the fraud perpetrated here was performed by high-level executives."
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