A Small Press Publishing Ponzi Scheme

#PublishingFoul Logo Indies UnlimitedGuest Post
by Anonymous

I can’t reveal who I am or the name of the publisher with whom I’m in a dispute, but I will say this: if there is anything on the internet that warns you about a publisher, steer clear of them. Don’t sign with a publisher who says you don’t need an agent. Don’t sign with a publisher who tells you that you don’t need membership in your genre’s professional writers’ organization. And don’t sign with a publisher if you see them acting less than professionally on any public forum, anywhere, at any time in the past or present.

I wish I had paid attention to these red flags. My publisher displayed all of them, but fellow writers told me this publisher took good care of its authors, so I ignored the red flags and signed a multiple-book contract.

It didn’t take long to regret it.

My books were published in editions saddled with blurry covers and riddled with typos, inferior in every way to what I can and have produced as a successful self-publisher. The biggest grievance, however, is that I was never, ever paid. In fact, the publisher owes me more than a year’s worth of royalties. I actually don’t even know the exact amount owed me, because the publisher has so far failed to give a complete accounting. What royalty statements they did provide are incomplete and fail to account for entire months. Interestingly, those were months when sales were up – as a self-publisher, I have a pretty good idea of how Amazon rankings translate into sales numbers.

I hired a reputable lawyer from a respected local law firm, who looked over my contract, looked over the publisher’s emails, and quickly came to the considered opinion that the publisher was in material breach of contract. The publisher’s response to the standard demand letter my attorney sent, however, was long, childish, and rude. While it did revert my book rights, the counter-demand a) insulted me personally and professionally; b) ordered my lawyer to cease and desist representing me in this matter; c) issued a vague suggestion that they could release galleys of my books into the public domain; and finally, d) assessed a fraudulent termination fee substantially greater than the amount of money they owe me, which included a 10% cut of the royalties they never paid me.

Ten percent of nothing is still nothing.

It made my lawyer laugh and advise me to ignore it, since we had achieved our primary goal, return of my rights. The absurd missive had obviously never seen the light under an attorney’s eyes before it reached my lawyer’s desk, and if the publisher didn’t care enough to hire a lawyer, it wasn’t worth a response. However, a few months later, I received another rude and childish letter from the publisher, threatening to send a debt collection agency after me if I did not immediately pay that aforesaid fraudulent termination fee.

Yes, the publisher kept every penny of my royalties AND threatened me with a debt collection agency to try to get even more money out of me. Reputable publishers do not behave this way.

And I’m not the only author this publisher has stiffed; I know of at least three others. In at least one case, the publisher attempted to silence the unhappy author with threats to sue if he/she went public about the fact that this publisher doesn’t pay. A Google search turns up little to indicate they might not be on the up-and-up, and people treat them like a respectable business – while they selectively pay some of their authors but not others (as in a Ponzi scheme, the ones whose royalties are used to pay others never get paid themselves).

Hence my warning: be very, very careful if you get an offer from a small press. No matter how desperate you are to be published, if there are any warning signs at all, turn them down and look elsewhere. Even the faintest red flag could prove to be the tip of a titanic iceberg of author abuse and unprofessional behavior.

I will, from now on, be taking my own advice.

Anonymous is an award-winning and bestselling author who hopes that one day, this story will be told using his/her real name. Meanwhile, he/she desperately wants to warn other authors that even if people are telling you a small press is reputable, it may not be.

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10 thoughts on “A Small Press Publishing Ponzi Scheme”

  1. This is useful, but I feel the need to point out that just because someone tells you that you don’t need an agent doesn’t mean someone is scamming you. I worked as an acquisitions editor for a (now-defunct) division of Prentice Hall and frequently told my professional nonfiction authors — who almost always came to us directly — that they didn’t need an agent. I didn’t refuse to work with agents, either, of course — but since my authors didn’t tend to make a fortune out of our niche markets, it struck me as 15% of a pretty modest payout that those authors were losing. For the rare repeat author whose books went into multiple printings, it might have made a difference — there might have been an extra thousand or two in the advance, or an escalation clause on trade royalties they were probably never going to earn anyway, but that’s all we ever gave for the trouble. (And a savvy author could just ask for them himself.)
    Obviously, an agent might make a much bigger difference in a predominantly trade marketplace with a big 5 publisher.
    So, for example, if you’re selling a poetry book to a university press and you already did all the work yourself to get an offer, I really doubt an agent is going to be worth the expense. And just because you’re told you don’t need one doesn’t mean the press is out to scam you.
    If they refuse to deal with an agent, though, be very wary. And yes, by all means, check Preditors and Editors and all the other sites for complaints about any publisher. Don’t just trust a Google search, either, unless you add “complaint” or “scam” or something like that. Scammers are expert at manipulating their Google search rankings with puff pieces.

  2. Thanks for the warning. I, embarrassingly enough, years ago, was contacted by a company wanting to make my first book into a movie! I was thrilled and uneducated. Oh, boy did I run my mouth to everyone about all the exciting news. I even posted a sign “Ask Susan about her movie deal!” at my very public work place. I started seeing some red flags and did a more comprehensive internet search. At 3AM, sitting alone at my desk, I found what I had hoped not to. I promptly woke up my husband, made him read it and cried for about 2 hours at my stupidity. So, it happens to the best of us no matter where we are in our careers. Lessons learned. One does recover from humiliation I learned.

  3. It’s amazing to me not only how dishonest, greedy and manipulative these guys are, but also how in-your-face bold and aggressive. A normal person might think these guys would, at some point, have some glimmer of remorse or conscience about what they do, but obviously not. The just keep pushing, keep trying to fleece a few more bucks out of their clients whatever way they can. It’s pretty sad. Thanks so much for sharing. People need to know about this crap.

  4. Melissa’s comment about ‘…glimmer of remorse or conscience about what they do, but obviously not.’ really got me thinking. Are these people so caught up in their own lies that they cannot see the truth any more? Or are they something more scary?

    Lack of conscience and lack of empathy are symptoms of a very well known condition. I hope I’m wrong.

  5. Where there’s money to be gained, there will always be scammers devising a way to extort it. Not only in the publishing world. And where there are scammers, there will always be the uninitiated who fall for the scams. I was once one of them. But no more. Thank you for sharing your experience. We will never be able to save everyone from being caught in these schemes, but if we can save even a few from losing their shirts – and their books – it is worth spreading the news abroad. Each one who learns from posts like this can share the news to their acquaintances and so on until hopefully enough will be informed so that these scammers will not be successful any longer.

  6. Reading this, my heart breaks for you. Since I have had my own struggles I can identify with your story but still I can’t help being horrified.

    I feel your pain and appreciate your story. Wishing you much success now.

  7. Can’t tell you how many of these stories I have heard. We just formed our own little publishing company (more of a publishing services company). We basically allow our clients to publish under our imprint, but through their own individual accounts that we help them set up with Createspace, Kindle Digital Platform, and other distributors. We charge only for the work we do, in editing, laying out the paperback version, formatting the Ebook version, designing the covers, and so forth. We purchase special ISBNs through Bowkers under our imprint. We also will set up and maintain a blog for them, if they so desire, charging only a small, set monthly fee to edit, add images (if necessary), and publish their posts. Lastly, if needed, we will design an ad campaign with various sponsored search advertisers, and maintain that as well for a small monthly fee. We never lock an author into a longterm contract, and we don’t take any of their royalties, which are paid directly to them through their various publishing accounts.
    So far, this has worked out very well for us as a company, and our clients seem happy as well.

  8. I feel so badly for you. But I am also glad you have your rights back, your lawyer told you to ignore the threatening letters and you are now on your way doing it right.

    I have heard so many stories like yours – even my own. Thank you for sharing. Only be shining bright lights on these crooks can we hope to prevent others from being lured into their traps.

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