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Fight Club author Chuck Palahniuk is the victim of an alleged embezzlement scheme at his literary agency.
“This chain of events leaves me close to broke,” Palahniuk wrote on his website.
Earlier this week, the New York Post broke the story of an accountant who was arrested by the FBI for allegedly embezzling $3.4 million from the Donadio & Olson literary agency. The agency also represents the estates of Mario Puzo, Peter Matthiesen and Studs Terkel.
Palahniuk said his income had dwindled for several years.
“Piracy, some people told me,” the author of Survivor, Invisible Monsters and Choke wrote. “Or the publishers were in crisis and slow to pay royalties, although the publishers insisted they’d sent the money.”
But it wasn’t pirates or publishers.
Darin Webb, 47, “provided bookkeeping services for the Agency and carried out his scheme by making unauthorized transfers from the Agency’s bank accounts, and then making changes to the Agency’s accounting system to evade detection,” the Department of Justice said in a news release.
A criminal complaint filed by the agency said Webb transferred money to his company in payments ranging from $1,000 to $75,000 per transaction during the alleged scheme, which began in 2011 and ran until March of this year.
The stolen money came from author royalties and advances, and may total “exponentially more” than the $3.4 million documented so far, The Post reported.
“All the royalties and advance monies and film option payments that had accumulated in my author’s account in New York, or had been delayed somewhere in the banking pipeline, it was gone,” Palahniuk wrote. “Poof. I can’t even guess how much income.”
He said the missing money is why the big shows on his book tour have stopped. These wildly popular events are full of props, prizes and candy and cost more than $10,000 to stage.
“It was justified in my mind because most of my readers had never attended an author reading, and I wanted their first to be exceptional,” Palahniuk wrote. “But when my income stopped, when I had to choose between health insurance and autographed rubber arms… the shows stopped.”
While money is now tight, Palahniuk said he has another form of wealth:
“On the plus side, I’m incredibly rich. Rich beyond my ever imagining, with friends and readers who’ve rushed to my rescue. Since the crime was uncovered, people have offered their children’s college funds. They’ve offered to mortgage their houses to keep me afloat. They’ve come forward with legal advice and stop-gap, hands-on help.”
If convicted, Webb could face up to 20 years in prison.
Palahniuk’s latest novel, Adjustment Day, was released earlier this month. It debuted at #7 on The New York Times hardcover fiction bestsellers list.
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