From Chuck Palahnuick:
On the plus side I’m not crazy. For several years my income has dwindled. Piracy, some people told me. Or the publishers were in crisis and slow to pay royalties, although the publishers insisted they’d sent the money.
More recently, the trickle of my income stopped. Not that there wasn’t always a good excuse. Someone’s mother was suffering from Alzheimer’s and needed constant looking after. The bank’s wire transfer system wasn’t secure, and hackers were a new threat. You don’t question someone who claims to be the caregiver for a mother with dementia. You let it slide. I let it slide.
That’s why my big shows on book tour stopped. Because the payment for Fight Club 2 and the two coloring books and Adjustment Day never seemed to arrive. Years of income. Each of those big shows cost north of ten grand to stage. Money I paid. For the glowing beach balls, the severed arms, the $150 leather-bound books as prizes, not to mention the dog toys, the shipping, the candy. So much candy. For each event, shopping carts full of candy. 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. But when my income stopped, when I had to choose between health insurance and autographed rubber arms… the shows stopped. There, I’ve said it.
In comics, you pay your own way. Invitations arrived from Comic-Cons, Dragon Cons, Wizard Worlds, but my money for travel had dried up. Instead of income, I got excuses. But this entire time an idea nagged at me: What if someone’s stealing?
But that, that was insanity. I’ve worked with the same team of people since 1994. To suspect anyone was stealing, I had to be crazy.
And then I wasn’t. You may have read about this over the weekend in the New York Post. 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. Poof. I can’t even guess how much income. Someone confessed on video he’d been stealing. I wasn’t crazy.
Link to the rest at Chuck Palahnuick’s blog
PG is interested to see a couple of articles describing the literary agency, Donadio & Olson, as a victim of the wholesale theft of client funds.
If a community bank closes because of financial improprieties that have continued for years, is the president of the bank regarded as an innocent bystander? Can he/she credibly point to a clerk and say, “It was all her fault! I had no idea this was happening over all these decades.”
In a criminal trial held in a court of law, the president is presumed innocent until proven guilty. In the court of public opinion, the president is presumed to be part of the scheme or too incompetent to be responsible for running a bank.
PG suggests that in the court of public opinion, the agents that own (and have owned) and operated Donadio & Olson during the lengthy period of time over which client funds were stolen from authors should be similarly judged.
In the event of a bank failure or financial difficulties, typically, an aggressive federal agency swoops in late on a Friday afternoon and takes over the books and records and operations of the bank. All the bank’s employees walk out the door while the government agency figures out what went wrong and who is entitled to how much money. The bank reopens on Monday morning under the direct management of the Federal Deposit Insurance Corporation. (Similar enforcement actions by other government agencies if a bank is not federally insured or a savings & loan has problems.)
It is PG’s impression that, like California, New York’s legislature has passed a law about nearly every subject imaginable. New York City prides itself as being the center of the traditional American publishing industry.
Where is the government regulation requiring that, if literary agencies are receiving and holding money that really belongs to someone else – authors – the literary agencies act like banks that receive and hold money belonging to other people and be treated as custodians of funds held to the highest standard of care?
If Big Publishing really cares about authors and doesn’t take them for granted, why don’t the standard terms of a traditional publishing contract include provisions that pay royalties directly to authors and agency fees directly to agents? Publishers will do this if asked by an attorney for the author. Why not make it the default?
As PG has stated before, nothing that is good for the author happens when an agency receives royalty payments to which the author is entitled. Passing funds through the agency bank account adds no value whatsoever and only provides an opportunity for something bad to happen to those royalties.