NEW YORK Former Ogilvy & Mather executive Thomas Early today was sentenced in U.S. District Court here to 14 months imprisonment for his role in a scheme to overbill the government's $1 billion Office of National Drug Control Policy ad account to cover a $3 million revenue shortfall on the business.
Early, the WPP Group shop's former financial director, and co-defendant Shona Seifert, a former executive group director at the agency, in February were found guilty of all 10 counts against them: one for conspiring to defraud the government and the rest for filing false claims.
Early, who will be on probation for two years after serving his sentence, must also pay a $10,000 fine and a $1,000 special assessment fee. He and Seifert each faced up to five years in prison. Seifert's sentencing is scheduled for tomorrow.
Judge Richard Berman did not order restitution by Early because in February 2002, Ogilvy agreed to make what was called a satisfactory payment of $689,744 in cash and another $1,150,256 in amended administrative costs to reflect a reduction of incurred costs claimed.
On Wedneday morning, Early, 49, and his lawyer, Laurence Urgenson, listened as Berman read the sentence. Early remained stoic in the courtroom, which was filled to capacity with about 70 relatives, friends and onlookers.
Early will voluntarily surrender to begin serving his sentence on Sept. 21 at an undetermined minimum security prison in Pennsylvania. The defense asked for and Berman granted a delay in surrender. The reason was so that Early could "remain a presence" in his Rockville Center, N.Y., household for his five children before they return to school, Urgenson said.
Early quietly replied, "Thank you, no," to a request for comment on his sentence.
"We had no idea what to expect," said Bill Chelius, who identified himself as Early's brother-in-law. He would not comment on whether a harsher or more lenient sentence was expected.
His wife, Ann Chelius, added, "My heart goes out to him. I don't see where he ever benefited financially. He was doing his job. Supporting his family."
During the February trial, both Seifert and Early insisted they did not ask Ogilvy employees to doctor timesheets to fraudulently increase the number of hours billed to the ONDCP. Early did concede that some timesheets appeared to contain inaccuracies.
On Wednesday, Early read a statement to the court, accepting some responsibility for what happened, but insisting that he did not think he was telling agency employees to falsify their timesheets or bill for hours not worked. "Looking back, I can see where all the problems started," he said, referring to the complexity of government contracts and a "culture of carelessness" at Ogilvy regarding timesheet completion.
All those factors should have alerted him, as the agency's finance director, to potential problems, Early said. "I truly regret putting myself and my family at risk," the statement continued, adding that he felt "true sorrow and fear" about the events surrounding the ONDCP case. "I was raised to be a good and decent person."
In deciding the sentence, Judge Berman said various factors were considered, including letters of support he received from more than 100 of Early's friends, family and supporters. "You should know I read every one of those letters," Berman told the court. He also considered Early's lack of a criminal past; his good standing in his Long Island community; and what the defense characterized as Early's "extraordinary family circumstances."
At that point, Kathleen Casazza, Early's sister-in-law, read a statement on his behalf to the court. In a choked voice that frequently cracked with emotion, Casazza described Early as "the backbone of my family," a father figure to her own two children while her husband served in the Army Reserves. "It was Tom who stood by my side and theirs," she said, adding that she worried about what would happen to her two children and her sister's five children if Early were jailed. "We all pray for your compassion," she told the judge.
In his concluding remarks before sentencing, Judge Berman said, "White-collar crime is no less serious or invidious than street crime . . . Some people would argue it's more serious" because it implies greed rather than need and displays a disregard for ethical conduct. "The government is entitled to an hour worked for an hour billed," he continued. "Senior executives have to behave lawfully, ethically, fairly and honestly in their business dealings with the government and others. Unlawful behavior in business is not okay."
Seifert, who will be sentenced by Berman on Thursday, had been president of Omnicom Group's TBWA\Chiat\Day in New York for two years. She took a three-month leave from the agency starting on Jan. 1 to prepare for the trial. Seifert and TBWA\C\D severed ties on Feb. 28.