MORE CHARGES IN MADISON AVE. PRINT SCANDAL

Former Grey Exec John Steinmetz Latest to Be Indicted

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NEW YORK (AdAge.com) -- A federal grand jury today indicted an ex-employee of Grey Global Group's Grey Worldwide, New York, on charges of conspiring to rig bids and allocate contracts for retouching and separation services provided by graphics services companies.

John Steinmetz, a former vice president and associate director of graphic services at Grey, is the third former Grey employee to be named as a defendant in charges arising from a long-running Justice Department investigation of bid-rigging, bribery, fraud and tax-related offenses in the advertising and printing industries. 

Calls to Mr. Steinmetz's lawyer were not returned at press time.

Former supervisor charged
Mr. Steinmetz' former supervisor, Mitch Mosallem,

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a onetime executive vice president and director of graphic services at Grey, was indicted in May and again in September on charges of bid-rigging, conspiring to defraud certain Grey clients and nine other fraud and tax charges.

Mr. Mosallem has pleaded not guilty to all charges.

Another co-worker, Joseph Panaccione, vice president and manager of graphic services, who was also supervised by Mr. Mosallem, pleaded guilty in October to charges of bid-rigging conspiracy.

Others charged
In addition to Mr. Steinmetz, others named in the indictment are Mr. Mosallem; John Ghianni, a former salesman at graphics services firm Quality House of Graphics, New York, and Birj Deckmejian, a salesman representing the Color Wheel, a graphics services company in Manhattan.

Mr. Ghianni was indicted by a federal grand jury in May along with Mr. Mosallem with conspiring to rig bids and allocate contracts for the supply of retouching and separation services. Mr. Deckmejian, who sold Color Wheel graphic services to Grey, was charged along with Mr. Mosallem in May with conspiring to defraud certain Grey clients in a phony billing scheme. No new charges were brought against Messrs. Mosallem, Ghianni and Deckmejian today.

According to papers filed in U.S. District Court, Southern District of New York, Mr. Steinmetz participated in a scheme, along with Mr. Mosallem, Mr. Ghianni and others, to rig bids and allocate contracts for retouching and separation services in advertising created by Grey on behalf of client Brown & Williamson Tobacco Corp.

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