NEW YORK Joe Panaccione, a former vice president, manager of graphic services at Grey Global Group, was sentenced today to three years' probation and a $366,675 fine for inflating clients' printing bills in order to fund a kickback scheme.
The bid rigging, bill inflation, bribery and conspiracy between the bosses of Grey's print production department and executives of print supplier The Color Wheel in New York existed from 1991 to 2000.
It ended with the arrest and conviction of several print managers at Grey and Color Wheel, who doled out favors, show tickets, print jobs and envelopes containing American Express gift certificates to dozens of management executives, creative staffers and various print productions workers at Grey.
It was Panaccione's job to identify individual print jobs with bills that could be inflated in order to pay for the scheme. The bills were inflated in order to provide extra revenue for Color Wheel, which then skimmed that revenue to pay kickbacks to Grey execs. In 1999 and 2000, Panaccione received $46,675 in kickbacks from print salesmen, according to prosecutors.
Most of the bill inflation occurred on the Procter & Gamble and Brown & Williamson accounts, although court records indicate that dozens of other clients paid excess bills over the years.
Judge Thomas Griesa of the Southern District U.S. Court in Manhattan indicated that Panaccione would have to sell his house in Bayonne, N.J., in order to pay the fine.
The bulk of that fine will go in restitution to Grey, which has a separate arrangement for paying back the clients its executives cheated. Panaccione, who testified at the trial of two others indicted in the scam, declined comment after the hearing.