Dentsu is set to pay back an estimated 230 million yen ($2.3 million) to clients after the agency uncovered a raft of discrepancies, including some cases where fees were charged and no internet advertising placement was made.
The Japanese ad agency's client Toyota was the first to point out a discrepancy, sparking an investigation into transactions dating back to November 2012, according to Bloomberg.
Dentsu uncovered 633 suspicious cases affecting 111 advertisers, including 14 examples where fees were charged and no placement had been made, the agency said in a statement on Friday (28 October).
“We will repay the 230 million yen, and we will talk with clients after all the facts are disclosed,” Toshihiro Yamamoto, Dentsu senior vice president, told reporters in Tokyo.
Other irregularities included discrepancies in advertising placement periods, failure of placement and false reporting regarding performance of the advertising. Also, some invoices did not reflect actual results, leading to overcharges.
“Immediately after finding out about the incidents, we organized an internal investigation team in the middle of August,” the company said.
Dentsu clients include LVMH Moet Hennessy Louis Vuitton SE, Diageo Plc, Nestle SA, SoftBank Group Corp. and Electronic Arts Inc., according to data compiled by Bloomberg.
The news is likely to heighten concerns within the industry that digital media transactions have lacked transparency.