January 7, 2004

Contractors charged with padding tab for drug abuse prevention ads

By Shawn Zeller

The U.S. Attorney's office in New York City has charged two former employees of a federal contractor with overbilling the White House Office of National Drug Control Policy while carrying out an advertising contract in 1999 and 2000.

The two advertising executives, Shona Seifert and Thomas Early, worked for the New York City-based public relations firm Ogilvy & Mather, which last year was forced to settle charges that it had overbilled the drug office by nearly $2 million. But the settlement did not preclude the criminal investigation, which led to the charges. The indictments were first reported Tuesday on the Web site of Advertising Age magazine

According to Advertising Age, Seifert and Early are accused of telling Ogilvy staffers to inflate the number of hours worked on the ONDCP account on their time sheets. If convicted of all the charges, they could both face up to five years in prison and $2.75 million in fines. Since Congress authorized the drug office to create an anti-drug media campaign in 1997, the agency has spent more than $1 billion.

Seifert and a lawyer for Early have denied the charges.

Ogilvy oversaw the placement of ads for the drug office on television and produced some memorable spots, including a series of ads that linked drug use to the funding of terrorism. In July 2002, even after the settlement, Ogilvy won a one-year contract extension based on open bidding overseen by the contracting office of the Navy, which handled the bidding for the drug office.

Then Rep. Bob Barr, R-Ga., led an effort to end the contract later that year. But the effort foundered. In December 2003, with Senate legislation pending that would have cut off Ogilvy's contract, ONDCP Director John Walters opted not to renew the contract for another year.