Despite the fact that earlier this month Ogilvy, owned by the WPP Group, agreed to pay the government $1.8m (£1.3m) to settle the dispute, a criminal investigation into alleged time-sheet alterations is gaining pace. To begin with, Ogilvy admitted no wrongdoing.
Ogilvy is accused of overcharging the Office of National Drug Control Policy by inflating labour costs. The FBI is in the process of interviewing employees past and present in order to establish whether any criminal activity took place.
However, the US drug tsar John Walters is apparently content with Ogilvy's settlement, which comprises a $689,744 payment to the White House and $1.5m credit against future bills.
Walters is also happy with the way Ogilvy conveyed the anti-drug message to millions of Americans, with two new ads shown during the Super Bowl at the beginning of February. He expressed his satisfaction with these new commercials at a congressional sub-committee hearing recently.
However, he had to defend his decision at the hearing to keep the anti-drugs assignment with the agency. One Republican representative, Bob Barr, asked: "Why is the government continuing to deal with this company when we don't have answers about the money we gave them?
"I don't think that any company that behaved this way should continue to keep the government work," he added.
Ogilvy's contract with the Drug Office, worth a reported $15m, expires next month and many of the agency's rivals are said to be pursuing the account. Those interested include McCann-Erickson and Saatchi & Saatchi. However, Ogilvy is quietly confident it will retain the work.
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