Chinese media rebate corruption probe widens across agencies

The Chinese government’s investigation into media rebate corruption which began with GroupM in October 2023 has now expanded to involve multiple agencies. Campaign Asia-Pacific has learned from reliable sources that Shanghai police have questioned as many as 30 or more individuals from GroupM, Dentsu, and vendors working with other networks. This suggests the issue is no longer limited to a single agency.

Campaign Asia-Pacific can confirm that Tommy Li, chief executive of Dentsu Media China, tendered his resignation at the company’s request on June 5 following an independent internal inquiry into corruption. His resignation was accepted by the company almost immediately. The investigation, reportedly prompted by a whistleblower complaint, found no evidence implicating other employees. Dentsu maintains that no client was directly involved.

Li has more than 20 years’ experience in media and strategy roles. He joined Dentsu China in 2019 and assumed leadership of the media division in September 2024. His remit included elevating the group’s media brands including, Carat, iProspect and Dentsu X while deepening ecosystem partnerships and advancing talent development. Prior to joining Dentsu, Li was the Shanghai head of trading at Omnicom Media Group for more than seven years.

Dentsu notified the police about the case on Friday, June 6.

Sources tell Campaign that Li is currently in police custody. While he sponsored accounts as chief executive, Campaign understands he was not involved in the day-to-day management of direct clients.

In the interim, Guang Cui, chief executive of Dentsu China, will oversee the media practice, supported by the current leadership team. The agency has reiterated that it already has governance measures such as whistleblowing channels, training, and processes in place, and has not introduced any new measures following this incident.

Several sources involved in the Chinese media industry contacted by Campaign are aware of rumours on Chinese social media suggesting senior managers at other agency holding groups beyond Dentu and WPP have also been questioned as part of this probe. In its initial enquiries, Campaign has been unable to substantiate specific allegations and some have been denied by the agency groups themselves.

Separately, Julep Lin, former chief client officer at Wavemaker China, has reportedly been arrested by Chinese authorities in Shanghai, according to multiple sources. Lin’s career at Wavemaker and GroupM spanned over 14 years, culminating in his appointment as chief client officer in August 2022. Prior to GroupM, Lin held senior roles at Accenture, The Walt Disney Company, and Nielsen. Lin resigned from GroupM in August 2024 coinciding with the agency's remediation efforts, and then served a two-month gardening leave, and more recently was freelancing for Havas Media in China, Campaign understands. 

Havas Media did not respond to Campaign Asia-Pacific’s request for comment regarding Lin’s situation.

According to sources, two members of the Shanghai police visited the WPP Shanghai Campus late last week to gather evidence.

In a statement released to Campaign, a WPP Media spokesperson said: 

When the allegations first came to light in 2023, we took immediate action to strengthen the implementation of our business controls, oversight and transparency in China. This included appointing new leadership and a chief investment governance officer. We are committed to upholding the highest ethical standards in line with our Code of Conduct and maintaining a culture of integrity throughout the business.

It would be inappropriate to comment further on an ongoing cross-industry investigation. We defer all questions to the relevant authorities.

Separately, Chen Yuan, a former member of GroupM’s investments team is now set to appear for trial at the Shanghai People’s Court on June 24. Chen left GroupM in early 2024 during a period of remediation that saw several high-profile departures, including that of GroupM China CEO and WPP’s country head, Patrick Xu, who stepped down in February after nearly a decade with the company.

Evident from the parallel court proceedings of the three former senior executives of GroupM China—Fei Di (also goes by Rycan), Lan Yao, and Xin Hong (Diana), the crux of the issue in corruption scandal involved the manipulation of media rebates. It was alleged that the accused executives negotiated inflated rebates with media platforms. Instead of returning these rebates to their clients, the funds were funnelled through intermediary companies and ultimately ended up in the pockets of the three defendants.

Campaign Asia-Pacific will continue to monitor the situation and provide updates as verified information becomes available.