Dallas M-N investigation shows 5.1% daily, 11.9% Sunday circulation overstatements

DALLAS — Belo Corp. expects circulation for The Dallas Morning News for the six-month period that ended Sept. 30 to be approximately 5.1 percent less daily and 11.9 percent less Sunday, following the conclusion of an investigation of irregular circulation practices. (read the Belo press release.)

The investigation was conducted by the national law firm Seyfarth Shaw under the supervision of the audit committee of Belo’s board of directors after the company revealed  Aug. 5 that circulation at The Morning News had been overstated.

The updated forecasts differ only slightly from Belo’s August forecasted declines of approximately 5 percent and 11.5 percent, respectively.

The investigation revealed that the circulation overstatement stemmed from aggressive pursuit of circulation goals by former senior circulation managers, inadequate procedures to monitor and verify distribution and returns, and use of an unrepresentative survey of returns percentages in state circulation.

The investigation found no irregularities at Belo’s other newspapers —  The Providence (R.I.) Journal, The Press-Enterprise in Riverside, Calif., al dia and Quick in Dallas, and the Denton Record-Chronicle.

The investigation’s second phase is expected to conclude at the end of October. Beginning in November, the third and final phase will focus on implementing long-term improvements and documenting and communicating all new processes and procedures to relevant constituencies.

More than 19,000 checks have been mailed or delivered to advertisers as part of a voluntary advertiser compensation plan. As of Sept. 24, 73.6 percent have cleared the bank, representing 62.8 percent of the $23 million The Morning News allocated, Belo reported.