New York-based Interpublic Group (IPG), a holding company whose agencies include Deutsch, MullenLowe and R/GA, has confirmed in a statement that one of its “standalone domestic agencies” has been contacted by the Department of Justice’s Antitrust Division regarding faulty video production practices.
The statement comes just days after the Wall Street Journal reported that the US Justice Department is currently investigating whether advertising agencies are rigging the bidding process for production contracts in order to direct business in-house as opposed to independent studios.
“The policies in our company's Code of Conduct require that we do business in a manner that is fully consistent with the best interests of our clients -- in the case of production, that means requiring triple bids on all projects above a minimal dollar threshold,” the company said in a statement. “IPG has established a long-standing record of holding ourselves to the highest standards of ethics and transparency and we expect all of our employees to act in accordance with our policies.”
So far, IPG is the only major holding company to acknowledge involvement in the investigation. WPP, Omnicom and Publicis have yet to comment.
As more and more agencies ramp up their in-house production facilities to keep up with client demand – for example, Leo Burnett launched its in-house studio “Greenhouse” last year – the issue of bid-rigging could become a growing concern.