Federal prosecutors in Manhattan are investigating whether ad agencies have been receiving rebates, or “kickbacks,” from media companies in exchange for business, according to The Wall Street Journal.
Lack of transparency around media buying practices has been an issue for years. It became a high-profile topic among industry executives in 2015 after Jon Mandel, the former CEO of media buying agency Mediacom, proclaimed that such kickbacks were rampant in the industry.
In 2016, the Association of National Advertisers issued a report after its own investigation into the issue. Over the past several months, the FBI also has started looking into it. But whether anyone actually is arrested or brought up on charges remains to be seen. And without any regulations around transparency of media buying, it will remain up to the advertisers to make sure they understand where every dollar they spend on campaigns is going, and that’s not an easy task.