According to papers filed in U.S. District Court, Southern District of New York, Joseph Panaccione, vice president and manager of graphics services, along with co-workers at Grey Advertising as well as vendors to Grey, defrauded clients of Grey by causing Color Wheel to issue false invoices relating to Color Wheel's contracts to produce graphic services and materials for advertising.
Mr. Panaccione is the fourth person to plead guilty in the case in the last week.
Those named in court
Messrs. Deckmejian and Ergulec were indicted by a federal grand jury in May on charges of conspiring to defraud certain Grey clients in a phony billing scheme from 1991 until July 2000.
Mitchell Mosallem, a former executive vice president and director of graphic services at Grey who was Mr. Panaccione's supervisor, is also named as a co-conspirator in court papers.
Mr. Mosallem was indicted in May by a federal grand jury for conspiring to rig bids and allocate contracts for the supply of retouching and separation services purchased by Grey on behalf of one of its clients from late 1994 until 2001. On Sept. 17, a federal grand jury added nine additional tax and fraud charges to his case.
Invoices allegedly inflated
Court documents allege Mr. Panaccione agreed with certain co-conspirators to inflate certain line items on invoices. According to court papers, Mr. Panaccione conferred with Mr. Casas to determine which line items should be increased and keep track of the scheme.
Mr. Panaccione, according to court papers, was paid approximately $46,675 in cash and checks by Mr. Chessa to ensure that the printing company Mr. Chessa partly owns received work.
Besides Mr. Casas, last week Howard Marlin, owner and chief executive of Caysun Graphics, New York, a brokerage of printing and other services, and Bertram Cohen, owner of Darbert Offset Corp., each pleaded guilty to one count of conspiracy to commit mail fraud and one count to commit tax fraud.