Former Star-Telegram publisher accused of misusing $500,000

Posted Wednesday, Apr. 24, 2013  comments  Print Reprints
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A newspaper company in Maine has accused Richard L. Connor, a former publisher of the Star-Telegram, of misusing more than a half-million dollars in company funds when he served as publisher there.

It's the second such allegation against Connor, who is chairman of the company that owns the Fort Worth Business Press. Last May, a newspaper in Pennsylvania filed a federal suit against him, claiming that he failed to reimburse $250,000 in personal expenses charged to his company credit card.

MaineToday Media, owner of the Portland Press Herald, accused Connor of spending $537,988 without authorization, the Press Herald reported Wednesday. The company has recouped all but the $50,000 deductible via an employee theft insurance policy.

The insurance company paid out after several independent forensic accounting reviews that took almost a year, the newspaper reported. Connor left MaineToday Media in October 2011 after 28 months as publisher.

Connor, 66, faces similar allegations as part of a lawsuit filed last year by his former newspaper in Pennsylvania, the Wilkes-Barre Times Leader.

In a telephone interview Wednesday, Connor said that both situations stem from confused accounting records and that he categorically denies any wrongdoing.

"What I can tell you is that it's a pack of lies," he said. "I never made any attempt to hide or deceive. There's a lot of complicating factors running two papers many hundreds of miles apart in Pennsylvania and Maine. And, particularly in Maine, finances were a mess."

In both states, Connor said he tried to clear matters up with the companies' accounting firms, "but they stopped talking to us."

In the Wilkes-Barres case, he said, "we contend that we are owed money."

As for the new allegations in Maine, Connor speculated that a grudge might be in play. MaineToday's new chief executive, private equity billionaire Donald Sussman, had been the subject of reports by the newspaper group about private use of his company plane by his fiancée, who is now his wife -- U.S. Rep. Chellie Pingree, D-Maine. Connor's attorney, Peter Bennett of Portland, Maine, said he has not ruled out taking legal action against MaineToday for the published report. He declined to elaborate, saying he hadn't yet had a chance to read it.

Among other things, the Maine newspaper group claimed that Connor gave himself $287,224 in unauthorized salary increases and bonuses, charged $90,381 in personal expenses to company credit cards, and used company funds to pay $70,352 on personal credit cards. In addition, it alleged that he used tens of thousands of dollars for vacation rentals and to buy his son a new Chevy Suburban.

"Mr. Connor was able to conceal his activity for as long as he did partly because company officers charged with financial oversight and reporting were frequently replaced," Lisa DeSisto, the current publisher of MaineToday, wrote Wednesday in a memo to employees, which was published online by JimRomenesko.com, a journalism blog. "In fact, the former CEO went through four chief financial officers in just over two years.

"When the former board of directors finally selected and installed its own, trusted CFO, it was only a matter of a few months before Mr. Connor's financial self-dealing was uncovered and he was out as CEO."

Connor told the Star-Telegram that he disputed this account, saying he hired the chief financial officer who uncovered financial irregularities. Connor maintained that he told the board, the company's bank and investors "that we needed to sort this out."

Connor said that, at one point, Peter Brodsky, a partner in the Dallas buyout firm HM Capital, which heavily invested in the newspaper group, urged Connor to get all his agreements transformed into signed contracts to protect himself.

But "I relied on verbal agreements and handshakes," Connor said.

Connor currently serves as chairman of DRC Media, the privately held company that owns the Fort Worth Business Press, and describes himself as a media consultant. He said he is not the owner of the Business Press.

In addition, he is CEO of a small newspaper in Dover, N.H., Foster's Daily Democrat. A Maine native, Connor was publisher of the Star-Telegram between 1986 and 1997.

Barry Shlachter, 817-390-7718

Twitter: @bshlachter

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