US federal prosecutors ramp up investigation into unscrupulous media buying practices
The investigation follows years of scrutiny of widespread non-transparent media practices, including rebates
US federal prosecutors have begun issuing subpoenas in their ongoing investigation into unscrupulous media buying practices in the advertising industry, which includes agencies receiving rebates from media outlets, according to reports.
As per the reports, some big agencies have disclosed that some of their subsidiaries were issued subpoenas by the Justice Department in the ongoing investigation into whether agencies have manipulated the bidding process by urging independent companies to inflate their prices so that contracts could be awarded to production and post-production departments owned by those agencies.
The investigation follows years of scrutiny after a report by the Association of National Advertisers uncovered several non- transparent media practices, such as rebates, which were widespread in the industry. Although the report did not name specific agencies, many of them denied any wrong-doing.
Recently, media agencies have come under increasing pressure from clients pushing for more transparency and a curbing of ad fees, with many brands moving their creative work in-house.
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