Last Updated Apr 23, 2010 11:20 PM EDT
The suits are worth reading by human resources professionals too: Management allegedly fired the executives who complained about sharp practices -- making internal fraud prevention procedures completely useless. It's a familiar tale: Companies often prefer to get rid of whistleblowers rather than clean up their acts. But that's a false economy: it places the enemies of management outside the control of the company, where their only friends are labor lawyers.
GMR's former CFO, Virginia Geraghty and a former controller, Laurie Becker, allege that they found four types of improprieties within Omnicom's sports, music and entertainment agencies:
- Geraghty reported "possibly fraudulent expense reporting they had observed in GMR's Canadian operations" to Omnicom, she claims.
- She says she was pressured to "adjust" The 11 Agency's balance sheet to make it appear healthier than it was.
- She questioned whether Radiate's financial control mechanisms were strong enough.
- And she alleges that GMR was not properly charging sister shop Banshee Music for GMR resources that Banshee was using.
In one meeting with Reynolds about Omnicom, Geraghty claims:
Reynolds referred to Omnicom's Director of Internal Audit, Greg Governale, as a "communist" and told Geraghty that she should not talk to him.Omnicom has yet to respond to either suit, both of which were filed in a Wisconsin federal court. GMR's clients have included Jeep, Sony (SNE), Orbitz (OMW), and Pepsico (PEP).happyeclair, CC. Hat tip to Rick Romell.