The federal investigation into New York’s print production industry – in particular graphics company Color Wheel and its customers [WAMN: 26-Mar-02] – has spread beyond Grey Worldwide to the New York office of Cordiant-owned Bates Worldwide.

Grey’s chief executive Bill Whitehead confirmed on Tuesday a report that his agency had been asked to cooperate with the inquiry. “I was advised that Bates, along with several other large agencies, was contacted by the Justice Department,” he said. “We are cooperating fully with their investigation.”

According to documents lodged by the US Attorney's Office in the Southern District [of New York], the inquiry relates to alleged collusion between agency personnel and “four or more” external suppliers of graphic services to defraud agency clients by authorizing “false and fraudulent invoices relating to its contracts”.

The probe has already resulted in the arrest two weeks ago of Mitchell E Mosallem, a former executive vp and director for graphic services at Grey Worldwide.

Data sourced from: New York Times; additional content by WARC staff