This story has been updated.
Havas has reportedly been subpoenaed by federal prosecutors over the U.S.'s ongoing investigation into media-buying practices, according to The Wall Street Journal.
The WSJ coverage singled out Havas, but it wasn't clear why.
The investigation is looking at nontransparent ad-buying practices, including agencies receiving rebates from media outlets, among other concerns, the WSJ reports.
Havas, which is owned by Vivendi SA, declined to comment. Rumors of this probe were initially reported by Campaign in June, although at the time, as now, there are not many specifics to the story.
Still, stocks dropped for the major holding companies, including Interpublic, Omnicom, and WPP after the article was published.
The FBI recently requested the cooperation of the ANA, but the group has not held any discussion with the government, per the WSJ. Others, however, are cooperating with investigations. The FBI has been interviewing an array of people in the ad industry over the past few months, the newspaper reports.
Havas Media Group US has issued a statement, noting “it cannot comment regarding an ongoing investigation within the industry. However, we would like to stress some important elements.
“Our clients are invited to, and in most cases do, audit our records pertaining to their accounts so they can validate for themselves that we manage their accounts in accordance with our agreements with them.
“While the media buying function has become increasingly complex during the last few years with the emergence of digital, we are fully committed to conducting our business in a transparent and ethical manner.
“We review our business practices on an ongoing basis with a view to continually improving our services and practices to meet high industry standards.
“All of us at HMG are committed to earning and retaining the trust of our clients through transparent and open relationships.”
This investigation is separate from the Department of Justice's look into commercial production
practices and potential bid rigging by agencies. At least five agencies -- Omnicom, Publicis and Interpublic Group, MDC Partners and WPP -- all received subpoenas into this ongoing query, which began
WPP and Publicis declined to comment at press time.
Transparency has been a huge issue and rebates have been from a good busiensss model to criminal in some
cases. Let’s clean up our industry.
I agree with my friend Xavier on some of the points, but I think that this is not so much an issue of transparency as it is an issue of contractual obligations. There are clients who have no problem with lack of transparency. VW in Argentina famously agreed to Initiative returning 1% of the billings and Initiative did so with the client's full knowledge that Initiative would be receiving AVBs. Other clients demand full transparency. The problem is when you agree on one thing with the client and then do something completely different.
If you can't trust your advertising agency to always act in your best interests, please feel free to pick up the phone and give us a call at R.M. Barrows Advertising. We would be happy to have your business.
R.M. Barrows, Inc. Advertising & Public Relations