Online Exclusive: Courtroom News

OGILVY TIMESHEET LAWSUIT BY WHISTLE-BLOWER REVEALED

Accountant Cites 'Excessive' Amounts of Missing Timesheets, Scribbles and Wite-Outs

By Published on .

NEW YORK (AdAge.com) -- Testimony in the White House drug office advertising trial yesterday revealed that in 2001 a federal whistle-blower documented agency timesheet inconsistencies in a lawsuit he filed against WPP Group's Ogilvy & Mather.
An accountant from the ONDCP's auditing firm cited Ogilvy's timesheets for 'general sloppiness,' large amounts of missing and altered documents, scribbles and the use of Wite-Out fluid and correction tape.
Companion Stories:
MORE TESTIMONY LINKS SEIFERT & EARLY TO BOGUS BILLING SCHEME
Criminal Inquiry Spreads to OgilvyOne Interactive Shop
OGILVY COLLEAGUE TESTIFIES SEIFERT, EARLY APPROVED SCHEME
Depicts Party, Meetings, Staffing Irregularities and Routine Records Alteration
TIMESHEET FALSIFICATION DESCRIBED IN SEIFERT TRIAL
Former Ogilvy Account Exec Details Shifts of Billing Data
DAY ONE OF SEIFERT TRIAL FOCUSES ON PADDED TIMESHEETS
'Hundreds of Ogilvy Employees Were Instructed to Lie'

Full Background:
BACKGROUND: THE WHITE HOUSE DRUG OFFICE ADVERTISING CASE
The Stories From 2001 to the Present

Read the 14-page indictment .pdf

ONDCP staffer
Richard Pleffner, an employee of the Office of Office of National Drug Control Policy (ONDCP), made his legal complaint after he reported Ogilvy timesheet inconsistencies to his superiors and the General Accounting Office.

Court documents obtained by AdAge.com showed that Mr. Pleffner, who served as the ONDCP contracting officer's technical representative, sued in August 2001 under provisions of the False Claims Act, a federal law that imposes civil liability on any entity that defrauds the U.S. government. One section of the act, known as the Qui Tam provision, allows a whistle-blower to sue on behalf of the government and share in any awarded damages. The lawsuit was originally filed under seal.

In August 2004, a federal judge dismissed the lawsuit, saying that Mr. Pleffner's reporting of the timesheet inconsistencies to his superiors and the GAO was part of his job and "not voluntary," one of the legal tests mandated by the statute. Mr. Pleffner's complaint was not admitted into evidence.

False billings case
It was the sixth day of the trial in U.S. District Court in Manhattan against former Ogilvy executives Shona Seifert and Thomas Early. Ms. Seifert, a former senior partner and executive group director at Ogilvy, New York, and Thomas Early, that office's former chief financial officer, have pleaded not guilty to an 11-count indictment accusing them of conspiracy in making false billing claims against the federal government.

Mr. Pleffner, who reviewed vouchers and timesheets submitted by Ogilvy, was not called to testify by prosecutors and was not expected to be among the witnesses called today, when the prosecution is likely to rest its case. The prosecution said it would call Ms. Seifert's former assistant, as well as government investigators and former Ogilvy employees.

White outs, corrections and scribbles
During yesterday's proceedings, the jury also heard from Wesley Mandler, an accountant from Cox & Associates, a firm the ONDCP hired to audit the $700 million media advertising contract with Ogilvy & Mather. Mr. Mandler testified to the general sloppiness of timesheets and vouchers Ogilvy submitted in order to be paid for labor and other costs it accrued on the national anti-drug account. He cited large amounts of missing or improperly completed timesheets as well as altered ones. "There were an excessive amount of timesheets that were scribbled on, more than I'd seen in any prior instance," said Mr. Mandler, adding that there were also uses of correction fluid and correction tape.

During cross-examination, Ms. Seifert's lawyer, Emmet Flood, asked Mr. Mandler if he was aware of the Mr. Pleffner's whistle-blower lawsuit. The government's attorneys promptly objected to the question, though Mr. Mandler said he did not know about the lawsuit.

The jury received only a brief version of Mr. Pleffner's case, offered by Mr. Flood, who characterized it as a federal complaint alleging that the administration of the ONDCP contract caused "emotional distress."

Interagency wrangling
So far, the government's administration of the contract has been depicted as fraught with interagency wrangling. Last week, Janet Miller, a contract officer for the Department of Health and Human Services, who had some oversight on Ogilvy's billings, testified as to having a bad relationship with Mr. Pleffner. "I didn't talk to him most of the time," she said, adding they communicated largely by e-mail.

The prosecution's case has hung largely on the testimony of former Ogilvy employees who said that Ms. Seifert and Mr. Early led a conspiracy to inflate hours billed on the ONDCP in order to close an anticipated revenue shortfall on the account.

In this article:
Most Popular