Disputes over WPP Italy deals escalate

The scandal surrounding WPP's Sir Martin Sorrell and Marco Benatti, the former country manager of WPP Italy, continued this week amid further revelations.

Sorrell is now investigating, with a view to firing, a number of senior management executives at the company who are closely linked with Benatti and his business deals.

Benatti was fired on 9 January after allegations of fraud. This followed disputes over an earn-out payment owed to him after WPP bought the Italian media agency Mediaclub in 2002, of which Benatti is the major shareholder.

Sorrell admitted at the weekend he was suing Benatti for breaching his consultancy agreement with WPP over the earn-out.

The network filed claims in the High Court of Justice on 11 January, two days after Benatti was fired, seeking damages of more than £150,000.

WPP is also investigating a Milan flat, for which WPP pays £50,000 a year, even though company employees were not allowed to use it.

Benatti has filed a complaint to Italian police in an attempt to dispel suspicion that he was involved in two alleged break-ins at WPP's Italian offices last month.