‘Fight Club’ author Chuck Palahniuk says he’s ‘close to broke’ after agent’s accountant charged with embezzlement

Chuck Palahniuk, the bestselling author of the cult hit “Fight Club” and the new novel “Adjustment Day” says he’s nearly out of money after an accountant was arrested and charged with embezzling from the author’s literary agency.

“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,” Palahniuk wrote on his website. “[T]his chain of events leaves me close to broke.”

The New York Post reported on Saturday that the FBI had arrested accountant Darin Webb on a charge of wire fraud. He’s accused of embezzling $3.4 million from the agency Donadio & Olson, which, the Post reports, is now close to bankruptcy.

The literary agency’s other clients include authors James Hynes, Rick DeMarinis and the estates of authors Robert Stone, Mario Puzo, Frank Conroy, Nelson Algren, Peter Matthiesen and Studs Terkel.

The U.S. Department of Justice said in a news release that Webb “provided bookkeeping services for the Agency and carried out his scheme by making unauthorized transfers from the Agency’s bank accounts, and then making changes to the Agency’s accounting system to evade detection.”

Webb could face a fine of up to $250,000 and a prison sentence of 20 years if convicted. He is out on $200,000 bail.

Palahniuk says he had to cancel his trademark shows at bookstores — which have featured giveaways of blow-up dolls, plastic severed arms and other outrageous gifts — and conventions because of the lost income.

“In comics, you pay your own way,” he wrote. “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?”

He also sounded a positive note, saying that his friends had offered him their children’s college funds and offered to mortgage their houses to help him financially.

“So where I’m at doesn’t feel so bad,” he wrote. “In this crisis I feel grateful and touched by every reader who’s shown me such support. I do hereby humbly thank you.”

The Post reported that the “alleged theft was first discovered last fall when an unidentified author who was expecting to receive a $200,000 advance from his publisher asked Webb why he had not received the payment.”