The advertising group has called in Kroll, a corporate investigator, and its auditor Deloitte to shine the spotlight on its media-buying operations in Italy.
It has also called in lawyers to deal with Benatti, who has claimed that he was forced out of WPP and has appointed his own lawyer.
Sir Martin Sorrell, WPP Group chief executive, personally terminated Benatti's contract on January 9 and since then the two sides have been unable to reach a settlement.
According to a report in The Sunday Times, the bust-up came after Benatti said he was owed an €8.9m earnout relating to WPP's acquisition three years ago of a media buying agency called Mediaclub. WPP believed the figure was around €300,000.
The investigation under way is believed to focus on the nature of Benatti's interest in Mediaclub, as well as other conflicts of interest and alleged illegal payments.
According to The Sunday Times, WPP has found out that at the time of the acquisition, Mediaclub was majority controlled and owned by Benatti.
A WPP spokesman could not comment this morning beyond confirming the companies it had appointed to conduct the investigation.
The group has not made any formal statement to investors because any losses are not believed to be significant to its worldwide operations. Its Italian revenue in 2004 totalled $250m (£140m), against worldwide revenue of $10bn.
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