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SEC Fines McCann-Erickson $12 Million

WASHINGTON (CN) - The SEC today charged McCann-Erickson Worldwide, one of the world's largest advertising firms, with accounting fraud, and fined it $12 million. The SEC also sued McCann's corporate parent, Interpublic Group of Companies, and sued two former McCann-Erickson directors in a separate but related case.

The SEC's settled federal complaints claim that IPG juggled the books for six years to meet annual profit targets. As a result, IPG eventually had to restate its pre-tax income for 1999-2004 by $240 million. McCann-Erickson, which owns hundreds of ad firms around the world, is IPG's largest subsidiary.

McCann's former CFO Salvatore LaGreca and its former Director of Operations Brian Watson also were sued in the settled complaints.

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