An accountant for the literary agency that reps Chuck Palahniuk was arrested this week for allegedly embezzling $3.4 million. The incident has left Donadio & Olson near bankruptcy, and apparently, the famous Fight Club author and Portlander broke.

The New York Post first reported the arrest. The accountant, Darin Webb, faces 20 years in jail, but is currently out on $200,000 bail. The investigation was prompted when Webb evaded inquires from an author expecting a $200,000 advance.

Palahniuk addressed the incident in a post on his blog:

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. Poof. I can’t even guess how much income . . . If you’ve written to me chances are that your letter passed through the hands of the accused.  He’d collect the mail and forward it to me.  He seemed like a good guy.  Like a prince of a guy.  Like man-crush material.  And then he wasn’t. On the minus side, this chain of events leaves me close to broke.

According to the blog post, Palahniuk had been suspicious of meddling with his accounts for several years, but previously suspected piracy. You can read the full post here.

Donadio & Olson also represents the estates of The Godfather author Mario Puzo and Stop-Time author Frank Conroy. It was founded by Candida Donadio, who was best know for selling Goodbye Columbus and Catch 22 to publishers in the 1950s. According to The Post, the investigation into Webb's embezzlement is going back to 2001, his first year at the agency.