The Eugene Weekly Halts Publication After Employee’s Embezzlement

A weekly newspaper in Oregon abruptly stopped publishing and laid off all of its workers after an employee embezzled tens of thousands of dollars and left months of bills unpaid, its editor said.

The newspaper, The Eugene Weekly, announced on Thursday that it would stop printing after it discovered financial problems, including money not being paid into employee retirement accounts and $70,000 of unpaid bills to the newspaper’s printer, Camilla Mortensen, the newspaper’s editor, said on Sunday.

The entire 10-person newspaper staff was laid off three days before Christmas, though some workers, including Ms. Mortensen, were still volunteering to publish articles online.

The Eugene Weekly, a free newspaper, was founded in 1982 and each week prints 30,000 copies, which can be found in bright red boxes in and around Eugene, one of the most populous cities in Oregon.

Recent articles described a New Year’s Day hike led by guides at a state park, the efforts of a nearby unincorporated community, Blue River, to recover from a 2020 wildfire, and a memorial to people who had died homeless in 2023.

Leaders of The Eugene Weekly said in a letter to readers that the newspaper’s finances had been left in “shambles,” but they planned to fight to keep the publication alive.

“The damage is more than most small businesses can bear,” the letter said. “The scale of this moment is unlike anything we have ever faced. But we believe in this newspaper’s mission and we remain determined to keep EW alive.”

Melinda McLaughlin, a spokeswoman for the Eugene Police Department, said that the police were investigating but could not provide more details while the inquiry was underway. The now-former employee accused of the embezzlement, who was involved in the newspaper’s finances, was not publicly identified.

Ms. Mortensen, who joined the paper in 2007 and became editor in 2016, said that charges had been filed against the person accused of embezzlement, who had worked there for at least five years.

The employee was out of the office earlier this month when questions arose about closing the financial records for the year and suddenly a host of problems were made apparent, Ms. Mortensen said.

“Every time I find something out, I just get sick to my stomach,” she said. “And again, this is someone we worked with who came to the office every day.”

These problems were discovered as the newspaper tried to recover from financial losses it had earlier in the Covid-19 pandemic, when businesses, such as local restaurants and event organizers, had stopped buying ads, Ms. Mortensen said.

In recent years, as local newspapers have rapidly shuttered and drastically reduced staff, The Eugene Weekly had taken steps to curb costs by cutting how many pages it printed.

Almost 2,900 newspapers have shut down since 2005, according to a 2023 report by Northwestern University’s Medill School of Journalism, Media, Integrated Marketing Communications. All but about 100 of the shuttered newspapers were weeklies. Most communities that lose a newspaper do not get a replacement.

Before the pandemic, The Eugene Weekly had done well financially, Ms. Mortensen said.

The owners, Anita Johnson, who Ms. Mortensen said is 94 years old and visited the office twice a week, and Georga Taylor, have never taken the newspaper’s profits and always put the money back into the business to pay for expenses, such as worker bonuses and new equipment. They also covered the costs for the last print edition of the paper, which came out on Dec. 21.

Ms. Johnson and her husband, Art Johnson, and Ms. Taylor’s husband, Fred Taylor, purchased the paper in the 1990s. Ms. Johnson had been a reporter at The Washington Post and Mr. Taylor, who died in 2015, was a former executive editor of The Wall Street Journal.

Ms. Mortensen said that while newspapers have focused a lot of attention on their digital product, in Eugene and the rural towns that surround it, “the print paper is still something that people really value.”

The Eugene Weekly is accepting donations to help it publish again and created an online fund-raiser that had collected more than $35,000 as of Sunday morning.

Ms. Mortensen said that people had also stopped by the office to make donations. A local bookseller who came by cried as she described how she had told visitors at her shop what happened to the paper when they asked about getting a copy.

Support has also come from unexpected places, such as retired journalists from The Register-Guard, the city’s daily newspaper, who volunteered editing help.

Ms. Mortensen said that the support had given her hope that the newspaper might be able to print again.

“I can think of $150,000 that we need to get to be a viable paper again,” Ms. Mortensen said. “And I’m looking at some of the money and going, ‘Oh my God, can we do this?’”