The ad agency-graphic services fraud scandal moved center-stage Tuesday with the start of the trial for mail fraud allegedly committed by former Grey Global Group executive vp of graphic services Mitchell Mosallem (58) in collusion with The Color Wheel and its owner, Haluk Ergulec (52).

Arraigned before New York’s US District Court, Southern District, Ergulec and his graphic services company both entered a guilty plea, while Mossalem pleaded not guilty. They were indicted by a federal grand jury in May on charges that include mail fraud plus, in Mossalem’s case, rigging bids and signing false tax returns.

Court papers reveal that Mosallem reported income of $43,123, while he actually received additional income of $28,010 – although the documents do not detail the source of the additional income.

Said his lawyer, Paul Bergman: “The money was described as commissions. Whether or not the commissions related to his employment, I'm not prepared to comment on at this point.” Nor did Bergman offer comment on the fact that this is not the first time he has represented Mossalem.

In a neat piece of digging by Advertising Age, it emerges that the current case has marked similarities to another hearing in 1983-84 when Mossalem served as a senior print production executive at New York agency AC&R.

On that occasion too Bergman acted as his representative, his client undertaking to inform the government of “any criminal acts in which [he] participated in [the Eastern District of New York], the District of New Jersey, and the Southern District of New York” that impacted on his personal tax returns or those of several corporations.

Mossalem later pleaded guilty to signing false tax returns for the calendar year 1978. He was required to pay approximately $45,000 in monies and penalties owed to the government and sentenced to two years’ probation.

But fortune smiled on Mossalem. Because his case was part of an ongoing federal investigation, the judge agreed that the probation officer on the case would not inform AC&R (Mosallem’s employer at the time) of his crime and sentencing.

Like any good lawyer Bergman, turned past guilt to present innocence: “When he [Mossalem] is guilty, he acknowledges his guilt immediately, as he did in 1984. Now, he is not guilty and he is going to fight the charges.”

None of the companies concerned with Mossalem, past or present, were prepared to comment on the proceedings.

Data sourced from:; additional content by WARC staff