Advertising holding companies cleared in DOJ investigation: Report

REUTERS / Jonathan Ernst

• Omnicom, Publicis, WPP, MDC Partners, and Interpublic
  Group are no longer under investigation by the Department of
  Justice.
• According to reports and SEC filings, the companies
  were notified that they had been cleared in a two-year
  investigation into practices like rebates and media
  production.

After a two-year investigation from the Department of Justice
into the production processes of advertising agencies, five of
the world’s biggest holding companies have reportedly been
cleared.

Federal prosecutors were specifically looking into
“non-transparent” practices like receiving rebates from media
outlets. Five holding companies had received subpoenas as part of
the investigation: WPP, Omnicom, Publicis, Interpublic Group, and
MDC Partners.

According to reports from
Adweek and
AdAge, all five holding companies have been cleared in the
investigation.

Omnicom and
MDC Partners each put out SEC filings today with information
to investors about updates to the investigation.

“As previously reported by Omnicom Group Inc. (the ‘company’),
two of the company’s subsidiaries received subpoenas in December
2016 from the Antitrust Division of the U.S. Department of
Justice (the ‘division’) concerning its investigation of video
production and post-production practices in the advertising
industry,” Omnicom’s
filing says. “The company received confirmation from the
division that its investigation of the company’s subsidiaries has
been closed without any action taken against the company, its
subsidiaries or employees.”

Over the past two years, the practice of non-transparent media
buying has ballooned into a massive issue for the advertising
industry after
a 2016 bombshell report from the Association of National
Advertisers revealed that such practices were “pervasive” in the
US but didn’t name specific agencies.