Japan's most powerful ad agency admitted it carried out almost 1,000 improper transactions -- including over-billing its clients

Tadashi ishiiDentsuTadashi Ishii, Dentsu’s former CEO.

Japan’s largest advertising company Dentsu announced it has closed its investigation into whether it over-charged clients for digital advertising services, having found it carried out 997 transactions “unsuitable for business practice” between 2012 and 2016.

At the beginning of its investigation in September, Dentsu suspected it had conducted 663 improper transactions, concerning 111 clients. Of those transactions, 40 cases were suspected to have resulted in over-billing for clients, with amounts totalling ¥230 million ($2.29 million).

The final report, published on Tuesday, found fewer clients had been affected by errors in reporting and invoicing. Of 96 clients affected, 10 were found to have been over-billed by Dentsu. The total transactions concerned amounted to ¥114.82 million ($1.01 million) in fees.

According to Japanese news site The Asahi Shimbun, the number of cases rose because the previous report put together some individual transactions under a single campaign. The amount of over-billing fell because a number of previously investigated cases were properly billed.

The investigated cases were related to Dentsu reporting it had ordered more online ads than had actually been placed.

Toyota was the first company to have discovered errors and complained to Dentsu in July 2016, prompting the launch of the investigation.

“The impact on business performance and financial status related to these issues are not material,” Dentsu’s statement reads. The company also pointed out that these cases were limited to Japan.

The agency blamed a number factors for these errors, among them: poor training in programmatic advertising, issues in human resources, and unclear definitions of what services it was providing to clients.

Dentsu stated it would take disciplinary actions against the executives involved. Campaign reports that 17 executives could face pay cuts of up to 20%.

Dentsu has been plagued by issues in the past year. Its president and CEO, Tadashi Ishii, stepped down in December after a 24-year-old employee committed suicide due to overwork.

NOW WATCH: WPP CEO Sir Martin Sorrell on Snapchat becoming the ‘third force’ to Google and Facebook

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.