Progress Press inflated printing figures in magazine invoices

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Progress Press, which is part of the Allied newspapers that publish The Times and The Sunday Times, has reportedly inflated the numbers of copies printed in invoices to magazine editors inserted in the Sunday Times for several years, a Lovin Malta investigation has reported. find.

The monthly glossy magazines were produced by external media houses, which had an agreement with Progress Press on the payment of a monthly royalty. The business model of media houses was to make money from advertising revenue. And Progress Press’s monthly fee, which typically ran into the thousands of dollars, accounted for the bulk of the production expenses for that particular magazine.

On invoices, Progress Press billed magazines for 40,000 printed copies. Yet several unconnected sources, including sources within Allied Newspapers, told Lovin Malta that the actual circulation of the newspaper printed at the time was just over half that figure.

They said the numbers were steadily higher only in the last three months of the year, as Christmas approached and other important national events, such as elections.

The sources said the inflated copy numbers on invoices lasted for years before some of the media companies discovered around ten years ago that the actual circulation or circulation was much lower than reported.

This has deteriorated relations with at least some of the news houses and ultimately led to bursts of threats and legal postures, including garnishment and receivership orders, issued over the years. The sources said some of these deadlocks and legal threats lasted until recently, with Progress Press ultimately contenting itself with heavy cuts on overdue payments.

Glossy magazines that were featured in the Sunday Times at the time include FM Magazine, Homeworks Magazine, Tune In, Style on Sunday, and Sunday Circle. Only the latter is still published.

In its investigations, Lovin Malta saw a frenzy of court activity at the end of 2014. At one point, Progress Press served a garnishment order on Network Publications, the publishers of the Sunday Circle, which was then changed. a week later in a receivership order.

The next day, Network Publications filed a court letter in which it sought damages or refunds from Progress Press on payments made in the “past years” after requests for monthly payments “for the publication of 40,000 copies. of the monthly Sunday Circle magazine when it results At first glance that the draw was much less than that.

Less than three weeks later, the garnishment and receivership orders were both revoked.

The two companies eventually struck a deal over the following years, and Sunday Circle is now produced by Allied Newspapers.

No response to Network Publications’ court letter could be found, and Lovin Malta asked Allied Newspapers acting managing director Alex Galea why Progress Press or its parent company had not responded to the court letters. He replied that “we are not aware of the legal protests (or letters) mentioned below against Progress Press”.

At that time, in 2014, the Managing Director of Progress Press was Michel Rizzo (having been appointed to this position in 2013), and Adrian Hillman was Director and President of the same company. Hillman was concurrently managing director of parent company, Allied Newspapers. Rizzo then became managing director of Allied Newspapers following Hillman’s resignation when he was featured in the Panama Papers leak as having received hundreds of thousands of euros transferred from an offshore company believed to be owned by Keith Schembri, who was the chief of staff of the former Prime Minister. Joseph Muscat.

Hillman, along with Vince Buhagiar, who was chief executive before Hillman, were recently indicted in court with bribing a multi-million printing press supplied by a Schembri company, which was also indicted in the same case.

Police alleged in court that Progress Press paid millions more than the printing press’s normal or actual price, with some of the inflated price being siphoned off in bribes.

Rizzo has been separately and more recently charged with alleged fraud and misrepresenting a public authority in connection with a grant made to Progress Press by Malta Enterprise.

Galea took over as interim CEO after Rizzo “suspended” himself.

Responding to questions about the actual circulation being less than the 40,000 copies claimed in invoices, Galea said: “All fees charged by Allied Newspapers not only covered printing but also prepress work, insertion and the distribution. These have been reduced over time as our digital products have become market leaders. “

Several sources said Progress Press changed or deleted wording on its invoices after at least some outside media confronted the company about circulating less than the number of copies specified on the invoices.

Several sources within Allied said the circulation of print newspapers continued to decline, with the Sunday Times circulation now falling below 10,000.

When asked if advertisers were or are being misled about the print circulation figures, Galea said: “Our loyal advertisers are making a conscious decision to advertise with our media because they attract the most. large readership / audience of Malta. Additionally, advertisers are offered packages that take into account our digital reach, which is the largest of any website in Malta and continues to grow.

What do you think of the revelations?

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