AD CHIEF QUITS TO FIGHT FRAUD CHARGES

The finance director of the WPP-owned advertising agency Ogilvy & Mather
resigned yesterday after criminal fraud charges were filed against him in
the US.

Thomas Early, 48, who is based in New York, is facing charges that he and
another executive conspired to overcharge the US government for an
anti-drug media campaign. The other executive, Shona Seifert, 43, left the
agency last year and now runs the New York office of Omnicom's TBWA Chiat
Day agency.

The company said Mr Early "decided to resign in order to devote his full
energies to obtaining a full vindication in this matter".

The pair have been accused of directing employees to revise their time
sheets between May 1999 and April 2000 and then submitting the false
documents to the White House's Office of National Drug Control Policy.

In the indictment on Tuesday prosecutors alleged they "participated in an
extensive scheme to defraud the US government by falsely and fraudulently
inflating the labour costs" that Ogilvy incurred under the contract.

Ms Seifert said she was innocent of the charges and planned to fight them.

The campaign, awarded to Ogilvy in 1998, was expected to be worth $684m
(UKP375.4m) over five years. But the White House began to question the
agency's billing practices in 2000. In 2001, the general accounting office
conducted an investigation and claimed Ogilvy had overcharged the
government by $7.6m.

The agency paid $1.8m to settle civil charges in February 2002, and
although that did not affect the criminal investigation, many thought it
was the end of the matter.

David Kelley, the US attorney for the Southern District of New York, has
charged both of the executives with one count of conspiracy and 10 counts
of making false claims. If convicted each faces up to five years in prison
and a fine of $250,000 or more.

The agency courted controversy with the its anti-drug campaign, with two
television commercials shown during last year's Super Bowl that drew direct
links between buying drugs and supporting terrorists.

Ogilvy maintains that it has fully cooperated with the government
investigation.